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Borrower FAQs

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How do I apply for a loan?

Applying for a loan through Monexo is simple and fast. You can complete the entire process online.

  • Step 1: Register as a borrower.
  • Step 2: Upload the documents required online and submit your loan application for review.
  • Step 3: Monexo will review your loan application and once approved, you will receive a quotation from Monexo. You also have the option of choosing your own interest rate which may be less than what Monexo offers you. Once you approve, we will list your loan request in the marketplace for lenders to fund.
  • Step 4: Your loan request will be listed for a maximum of 15 days during when lenders can choose to fund your loan. Once your loan is funded, it will be paid into the bank account that you have shared with Monexo. On the last day of listing, if more than 60% of your loan is funded, we will pay the funded loan amount to you. Loans which are less than 60% funded on the last day of listing will be removed from the marketplace.

Why borrow through Monexo and not a bank?

Being an online peer-to-peer lending marketplace, Monexo is able to eliminate many of the costs that are incurred at banks and large financial institutions. We then translate these savings into lower interest rates for you. In addition, since the loan process is completely online, we are able to process your loan much faster.

What are the fees associated with the loan?

When your loan is funded you will pay a percentage of the loan amount, ranging from 2% to 4% depending on your Monexo rating, as a servicing fee, which will be deducted by the TPC from your loan disbursement prior to depositing the funds in your account.

What is a Monexo Rating?

Each loan application received by Monexo is screened and given a Monexo Rating.

The Monexo proprietary screening system is based on the information provided by you in your application form and the supporting documents (which include your income and past payment history).

The ratings range from M1 to M8, with M1 being the best. The interest rate associated with the M1 to M8 band will vary based on Monexo's Policy.

Once the loan listing is approved, the Monexo Rating is displayed in the marketplace along with the loan listing details for lenders to view.

What is the difference between a listing and a loan?

A listing is your request for loan displayed in the Monexo marketplace. Lenders can view the loan listings in the marketplace and may choose to fund your loan. A loan is when the funds are disbursed to you after your loan listing receives funding as per listing norms from the lenders in the marketplace.

Can I borrow money for any purpose?

You can request a loan for any purpose you select from the options listed in the application form. Maybe you need this to improve cash flow, tide over short term needs, lower the cost of borrowing or even buy a property overseas. All of these are possible.

If I apply for a loan, how long will it take till the money is in my account?

Once your loan is approved, we will list your loan request in the marketplace for lenders to fund. As soon as your loan is fully funded or your loan is funded 60% or more & reaches a 15 day listing period, we will disburse the money to your designated bank account as per the processing time taken by the bank.

Can I repay my loan early, either fully or partially?

You have the option to prepay the balance loan amount earlier than the contracted tenor, provided you repay 100% of the outstanding amount (including the interest due till date) in one go. There is no penalty or charge for prepayment. However, partial prepayments are not allowed.

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What is the process of listing a loan after submitting a loan application?

Monexo will review your application for completeness and may contact you for additional information as needed.

If your application is approved, you will get a loan offer which includes loan amount, interest rate and tenor. Once you accept the offer, we will list your loan on the marketplace for lenders to fund. If you don’t accept the loan offer, you also have the option of choosing a reverse bid specifying the interest rate you expect.

Your loan listing will appear on the marketplace for 15 days, during which time lenders will have the ability to fund your loan listing.

When will the loan get disbursed to me?

The loan will be disbursed once it has received 100% funding during the loan listing period.

Otherwise, if on the last day of listing in the marketplace (15th day), if you have received more than 60% funding on your loan listing, the loan will be disbursed to you to the extent of the amount funded in the marketplace. If the funded amount is less than 60% on the 15th day, the loan amount won’t be disbursed to you.

You will be informed upon loan disbursal and the loan proceeds will be deposited into the bank account that you have provided in the application form.

What is Reverse Bidding?

In Reverse Bidding, you can request for an interest rate which is more or less than the Monexo Interest Rate. Lenders have the flexibility to bid at a rate which is between the Monexo interest rate and your requested rate. As soon as the loan is funded 100% in the marketplace, you will get a weighted average interest rate as an offer which you can choose to accept/reject. Each lender who has bid for the loan will receive the interest rate that he/ she has bid for.

There are no guarantees that your requested interest rate will get you a loan. However, it is your choice to try this option.

How do I withdraw funds once my loan is funded?

Once your loan is funded, TPA will send your loan proceeds directly to your verified bank account. You will get an email confirmation, please track your funds in your bank account. Any banking fees charged will need to be borne by you.

When is my payment due?

If your loan is disbursed on or before 15th of a month, then your first EMI will be due on 1st of the subsequent month. For example, if your loan proceeds are disbursed on 5 April, then your first EMI is due on 1 May.

If your loan is disbursed after 15th of a month, then your first EMI will be due on 1st of the month after the subsequent month. For example, if your loan proceeds are disbursed on 20 April, then your first EMI is due on 1 June

Thereafter, for every EMI, the due date is 1st of the respective month.

Do note that interest is payable from the date of disbursal to the date of payment.

What happens if I am late for my payment?

Monexo has a proactive payment reminder service, so we will email you to alert you for payment by due date.

However, if you have been unable to make your payment on the 1st day, you have a grace period of repaying by 4th of the month.

If the payment is not made into the trust account latest by the 4th of the month, you will be charged a Rs 350 late fee and your balance, including the late fee, will be subject to a higher overdue interest rate on a daily basis until the EMI and the late fee are paid.

If your EMI, late fee and overdue interest are not received within the month they are due, your loan will be referred to an accredited collection agency. This could impact your credit rating and future credit opportunities.

Do you report my loan performance to the Credit Bureau?

Monexo reports your performance to the Credit Bureau.

In what circumstances the lender can come to know my identity?

If you default on the loan, we will be required to share your identity with the lender.

How do I know that the lenders are receiving the repayment?

Monexo has appointed an independent third party (TPA) to be the administrator of the funding account where the funds are managed. You get a confirmation that your repayment has been received. We keep all lenders informed regularly of their investment balances and transactions in their loan portfolio.

How is my repayment applied towards the loan dues?

The repayment is applied in the order of interest due till the date of receipt of repayment, principal amount and then for  late fees & penal interest due.

Do I have to pay any fees to the sales & distribution agents of Monexo?

You do not have to pay any fee to Monexo’s sales & distribution agents. If a sales agent demands a fee, please do bring this to our notice immediately.

What is NACH Debit?

NACH Debit is a mechanism to facilitate auto debit of your EMI from your bank account to administrative account.

National Automated Clearing House (NACH) is a service offered by National Payments Corporation of India. To know more click here.

Is it mandatory to give NACH Debit mandate before my application is listed in Monexo?

Yes. You need to submit NACH Debit mandate along with other documents during application process.

How should I submit NACH mandate?

Step 1: Fill the NACH Debit mandate

Fill the below mentioned fields of NACH Debit mandate and affix your signature.

  • Bank account number
  • Bank
  • Either IFS Code or MICR
  • Phone number
  • Email ID
  • Your name/ s against serial number

Step 2: Upload/ Email

Upload the signed and scanned copy of the mandate while you are uploading other documents as part of application process. You may also send the scanned image through email mentioning your Application Number and Customer ID.

Step 3: Mail the mandate

You are required to send the physical copy of the mandate to the below mentioned address citing your Application Number and Customer ID on the rear side of the mandate.

Monexo Fintech Pvt Limited,
Absul Rafar Building,
15/7, Basha Street,
Choolaimedu,
CHENNAI - 600094

From when my account will be auto - debited?

If your loan is disbursed on or before 15th of a month, then your account will be auto - debited on from 1st of the subsequent month on due date. For example, if your loan proceed are disbursed on 5 April, then your account will be auto - debited from 1 May.

If your loan is disbursed after 15th of a month, then your account will be auto - debited on from 1st of the month after the subsequent month. For example, if your loan proceeds are disbursed on 20 April, then your account will be auto - debited from 1 June.

Can I use a different format of NACH mandate?

NACH Debit mandate format is uniform across India and is determined by NPCI. No change in format is acceptable to NPCI.

What is the process through which NACH mandate will be submitted to my bank?

Once we receive the signed NACH Debit mandate, it is submitted to your banker through NPCI for authentication.

Thereafter, for every EMI, on the due date a debit instruction is sent to your banker through NPCI.

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What are the fees associated with the loan?

When your loan is funded you will pay a percentage of the loan amount, ranging from 2% to 4% depending on your Monexo rating, as a servicing fee, which will be deducted by the trust company from your loan disbursement prior to depositing the funds in your account.

What interest can I expect to be charged on the loan? How is it determined? How does it compare to loans available in the market?

Monexo is committed to assisting in bringing down the cost of credit to borrowers on the marketplace. The interest rates on the loans available through the Monexo marketplace range from 12% to 30% for Loan against Salaried, 13.5% to 30% for Loans for Self-employed  and 14.5% to 30% for Business Loans . We offer you a rate based on Monexo's proprietary screening process.

Alternatively, you have the flexibility to request your own rate as a reverse bid. We will list your loan with your requested rate and our recommendation. It will then depend on the lenders in the marketplace to fund your loan listing on your requested rate.

We believe that interest rates on Monexo's marketplace are still significantly lower than the market rates for credit cards or unsecured personal loans.

What is APR (Annualised Percentage Rate)?

An Annualised Percentage Rate (APR) enables you to easily compare the cost of credit as you evaluate multiple loan offers. At Monexo, the APR includes the maximum of 30% yearly interest rate and the loan-funding fee of 2% to 4%, which varies depending on the amount of the loan. The fee is deducted from the proceeds of your loan amount, whereas the interest rate is included in your monthly payments during the term of your loan.

All loans feature fixed interest rates and monthly payments, which means that they will never change during the term of your loan.

When do you charge late fee and penal interest?

Monexo proactively reminds you when your payment is due. However every time when you do not make a payment by the 4th of the month, you will be charged a  350 late fee. Moreover, you will be charged with an additional penal interest of 24% p.a. calculated on a daily basis till the date of receipt of the amount due.

What are the advantages of reducing balance method over a flat rate that most banks or moneylenders use?

Monexo uses a reducing balance method to allocate EMI to principal and interest portions. When you send a payment, you pay interest on the remaining loan balance only and not on the whole loan as done in flat rate method.

A reducing balance interest calculation formula can be represented like this:

Interest Payable per Instalment = Interest Rate * Remaining Loan

In the flat rate method used by many banks and moneylenders, they just apply the same amount to the principal and interest so you pay higher interest over the life of the loan.

Example:

Comparison of the two interest calculation methods for a loan amount of Rs 1,00,000 over a tenor of 12 months with an interest rate of 10% p.a.

Flat Rate MethodReducing Balance Method
Total Interest Paid ₹ 10,000 ₹ 5,499
Total Repayment ₹ 1,10,000 ₹ 1,05,499
Comparable Flat Rate Interest 10% p.a. 5.5% p.a.
Savings on Interest ₹ 4,501
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Am I eligible to apply for a Loan against Salaried?

To apply for a Loan against Salaried, you must meet the following three basic criteria.

As an individual, you must:

  • Be 21 years of age or above
  • Have a monthly salary of Rs 15,000 or above
  • Have a valid PAN Card
  • Work experience of minimum 3 months

Note: These are the minimum requirements. All borrowers are subject to Monexo screening and approval process.

I already have a personal loan from another bank, am I still eligible for a Loan against Salaried through Monexo?

Yes. You are eligible for a Loan against Salaried via Monexo as long as you meet the eligibility criteria. The loan amount that you are eligible for will take into account the debt that you already have.

What are the documents required to apply for a Loan against Salaried?

Monexo requires the following documents to process your Loan against Salaried application.

    • PAN Card
    • Latest residential address proof
    • Latest 2 months’ salary slips
    • Latest 3 months’ bank statements / passbook showing your name, account number and salary entries

We wish to obtain, verify and record information that identifies each person who opens an account. What this means for you is that, when you open an account, we will ask for your name, address, date of birth and any other information that will allow us to identify you.

What are the minimum and maximum amount of the Loan against Salaried?

The minimum and maximum amount of the Loan against Salaried are  50,000 and  5,00,000 respectively. These amounts are subject to change.

What are the minimum and maximum tenor of the Loan against Salaried?

The minimum and maximum tenor of the Loan against Salaried are 6 months and 36 months respectively. These numbers are subject to change.

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What is "My First Loan" and what is the eligibility criteria?

We offer "My First Loan" to borrowers who have never taken a loan before. We understand that it can be challenging to get credit from traditional banks if you don't have a credit history. We would like to make credit easily and quickly accessible to you.

"My first loan" offered is Rs 50,000 for a duration of 12 months to salaried individuals.

To be eligible for a "first loan", you need to

  • have a minimum monthly salary of Rs 15,000 that is credited to your bank account. You also need to have a valid PAN and Aadhar ID.
  • provide copies of Aadhar card, address proof, 2 months salary slip and 3 months bank statement showing salary credits.
  • complete verifications as part of the application process so that we can retrieve your bank statement data, income data and Linkedin Profile.

To know more about the borrowing process, go to https://www.monexo.co/in/borrower-faqs

Why do we ask you to connect to your Linkedin profile?

The data we get from a your LinkedIn profile helps us understand your career growth, educational background and earnings potential. We use your LinkedIn data as part of our screening process for reviewing your application form, verifying identity and minimizing fraud.

How does taking a first loan impact your credit score?

With a first loan at Monexo, you are taking your first step to building your credit profile.

  • The monthly repayments done by you are reported to the credit bureau by Monexo.
  • Timely repayments and responsible borrowing behaviour will help you build a good credit score over a period of time.
  • With a good score, it is helpful to get credit in future.

How will "My First Loan" help me build credit?

Getting a new loan gives you the opportunity to repay successfully and build up your credit. If you have never yet established credit – it will improve over time with each monthly on-time payment.

Your credit is all about your history as a borrower. If you’ve borrowed and repaid loans successfully in the past, lenders assume that you’ll do the same in the future. The more and the longer you do it, the better.

Why should I pay on time?

Once you have received a loan, it is important that you pay your monthly instalments on time.

  • Your repayments have a significant impact on your credit score.
  • Any missed payment or defaults will bring down your credit score.
  • Finance companies may decline loans in future or provide a loan at a high rate.

Timely loan payments will help improve your credit score, making you a more attractive borrower. Since your credit score defines your credit health, delayed payments and defaults will bring down your score.

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What is Monexo's "Credit Shield" ?

In life, not everything goes per plan and at Monexo - we understand that. Monexo's Credit Shield is an innovative, specialised group insurance cover which insures borrowers who enter into contracts with Monexo from specific unforeseen event based risks which might adversely affect their ability to repay outstanding loan obligations.

All borrowers who enter into loan contracts with Monexo become automatically enrolled into this group insurance cover post loan disbursal - at zero additional cost.

This Credit Shield has been structured by Monexo in partnership with one of India's leading private insurance companies.

What are the benefits of Monexo's Credit Shield for borrowers ?

Monexo's Credit Shield ensures that repayment of loan obligations in the event of occurrence of specific unfortunate events is not daunting. We understand that circumstances such as (i) accidental death, (ii) total or permanent partial disability and (iii) job loss are sudden, challenging situations to navigate for both the borrower and his / her family. At Monexo, we believe that borrowers going through such onerous personal circumstances should not feel overburdened by their outstanding loan obligation on Monexo.

As a result, in the event of occurrence of any of the above unfortunate situations, Monexo's Credit Shield ensures that the borrower's outstanding principal repayment or EMI (as per terms and conditions in the insurance cover) is reimbursed and paid to lenders by the insurance company.

What is the coverage limit and the circumstances under which a claim can be made by the borrower ?

Cover againstDescriptionCoverage limit
Accidental Death of Borrower In the event of borrower's loss of life due to injury caused by accident, the insurance company will insure the borrower and reimburse the outstanding principal directly to all the lenders associated with the relevant loan contract. The loss of life should occur within 365 days of the accident. Accident, for the purpose of this insurance cover, means any sudden, unforeseen and involuntary event caused by external and visible means 100% of outstanding principal
Permanent, Total and Partial Disability of Borrower In the event of borrower being totally or partially disabled due to an accident or sudden illness (non pre-existing condition), the insurance company will insure the borrower and reimburse upto 100% of the outstanding principal to all the lenders - with the payable compensation being a pre-determined percentage of the sum insured Upto 100% of outstanding principal
Borrower Loss of employment In the event of the borrower being terminated / temporarily suspended / retrenched from employment by his/her employer, the insurance company will pay a fixed lumpsum upto 3 months of EMI directly to the lenders associated with the relevant loan contract Upto 3 months of EMI payable by borrower

Please note that the above constitutes only a summary of the cover. Actual coverage is subject to the terms, conditions and exclusions set out in the Certificate of Insurance, purchased by Monexo’s partner entity for the benefits of borrowers and lenders who enter into Loan contracts with Monexo Fintech Pvt. Ltd.

Are there any exclusions to the coverage ?

Yes. There are certain exclusions from coverage as there are certain risks which are not within the insurance company’s risk appetite or which it cannot insure. Without limitation, the following are excluded:

  1. Pre-Existing Diseases
  2. Suicide, attempt to Suicide or intentionally self- inflicted injury, sexually transmitted conditions, mental disorder, anxiety, stress or depression.
  3. Being under influence of drugs, alcohol, or other intoxication or hallucinogens
  4. Participation in actual or attempted felony, riot, civil commotion, crime misdemeanour
  5. Committing any breach of law of land with criminal intent.
  6. Professional sports team in respect of specific benefit for inability to perform
  7. Participation in any kind of motor speed contest.
  8. While engaged in aviation, or whilst mounting or dismounting from or travelling in any aircraft other than as a fare paying passenger in a Scheduled Airline.
  9. Underground mining & contractor specializing in tunnelling
  10. Naval, military or air force personnel
  11. Radioactivity, Nuclear risks, ionizing radiation
  12. Detailed Exclusion as per the Standard Policy Wordings of the Group Secure Policy

What is the Certificate of Insurance and how can a borrower review it ?

The Certificate of Insurance is the master document which governs the terms and conditions of this group insurance cover for borrowers. A copy of the Certificate of Insurance will be provided by the insurance company and shared with all borrowers who enter into loan contracts with Monexo.

Who pays the premium associated with this Credit Shield ?

This group insurance cover is purchased and paid for by Monexo's partner entity - with no additional cost to the borrower.

What is the process to make a claim ?

To make a claim, borrowers must immediately reach out to the claims department of the insurance company with written intimation and supporting documentation to help the insurance company assess the claim being made. Kindly 'cc' contact@monexo.co in all email communication which is sent to the insurance company

All relevant details of the insurance company will be available in the Certificate of Insurance.

An indicative list of documentation that may be required to support your claim constitute :

  1. Claim Form duly signed
  2. Identity Proof
  3. Accident Proof : FIR, Panchnama, Final Police Report etc
  4. Cause of Loss :Viscera Report, Medical Report etc
  5. Disability : Disability certificate from Government Medical Board, Fitness Certificate and Medical Prescription
  6. Accidental Death : Proof of death
  7. Medical expenses : Hospital discharge summary, Bills, Medical Practitioner Certificate etc.

To whom will the claims proceeds be paid ?

The claims proceeds (as per terms and conditions mentioned in the Certificate of Insurance) will be paid by the insurance company to all lenders associated with the relevant loan contract(s).

When does insurance coverage commence ?

Coverage in relation to any specific loan commences on the date the loan is disbursed to the borrower and ends on either the date the Loan is fully repaid to the lender, or the date stated in the Certificate of Insurance in relation to the Loan which is issued after loan disbursement. This insurance can be withdrawn by the issuer anytime. In that scenario, it ceases immediately.

What data is passed on to the insurance company and for what purpose ?

Monexo will provide the insurance company with basic information in relation to the Loan such as Borrower's name and Know Your Customer ("KYC") info - solely for the purpose of administering and providing the insurance. All information is kept strictly confidential and used only for the purposes of this insurance.