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 Is a consumer loan really necessary?

Is a consumer loan really necessary?

As we move forward in our lives, perhaps the only constant thing in the scheme of things is change. Not only is it constant, change is inevitable. If we look at the change in consumerism in our country, it is tremendous. 20 years ago, people hesitated to buy a television sit  whereas now people don’t hesitate to go the length to buy whatever they wish for. These days, things are bought whether or not they are needed. Let us stop and take a long hard look at what we’re doing.

Is it really necessary to buy something just because we want it? Well, thanks to the endless offers and schemes & what with credit card rewards on every purchase, purchasing a lcd tv or a brand new laptop is not as big a deal as it was a few years ago.

The new wave called consumer loans has taken the retail market by storm. Buyers are granted on the spot loans at the time of their purchase, to help them buy the product of their choice. So, even if it is beyond one’s buying capacity, we are tempted to buy the next shiny new thing at the store. Consumer loans are made so easily available to anyone who would take it, simply because it enhances the buying process.

Although, it is not entirely a bad idea to avail a consumer loan, is it really worth paying monthly installments every month to pay for your lcd tv? Wouldn’t it be better if you allocated the same money towards a savings account in your bank? If you look at this whole thing objectively, you should question yourself whether it is absolutely essential? Is it something so useful for your everyday life?

Let us take a look at some of the advantages as well as disadvantages of a consumer loan:


- easy, affordable installments

- 0% interest rate schemes. Calculate your interest rate which your favourite bank.

- simple documentation

- on the spot approvals

- flexible repayment facilities such as part-payment available

- habit of paying emis regularly is inculcated


- instead of paying emis unnecessarily, reallocate the same amount towards a bank deposit for saving instead

- unnecessary if you are struggling to pay it every month

- these consumer loans can be availed only in select stores

- additional processing fees is included

- some vendors may include hidden charges as well

Taking up a loan whether it is as small as a consumer loan or as big as a home loan, it requires commitment when it comes to repaying it because borrowing is perhaps the easiest thing to do, whereas repaying it is a whole other story.


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Priya Rai is a loan consultant.