Do you know that you can get a quick loan against your salary? It is surprisingly less popular among salaried people.
The reason is because of its low popularity. Yet this loan is quite good for quick cash. The facility is available to those who maintain a salary account with the State Bank of India.
Here is the catch…
The facility is available only to those who have a Corporate Salary Package account with the Bank.
As per the variant of the account, the eligible amount will be given to customers.
The bank has these CSP variants: Silver, Gold, Diamond, and Platinum. Silver gets ₹40000, Gold gets ₹75000, Diamond gets ₹150000 and Platinum gets ₹2 lakhs.
What is a Corporate Salary Package account?
SBI prioritizes its customers based on their income criteria. If it’s a salaried account, then these accounts will be covered under CSP accounts.
From state government organizations to the central government, all employees will fall under CSP.
It also includes public sector undertaking bodies, universities, schools, and colleges.
In addition to that, various other corporate giants are having tie-up arrangements with the bank to get the offer under the corporate salary package.
To learn more about the CSP account, please visit here.
Understanding Overdraft against the SBI salary package account.
An overdraft facility can be availed in two ways. One is through the Branch channel, and the other is through the Online channel.
It is a clean overdraft account in which banks set a credit limit on your salary account. You can use funds within the credit limit.
The drawing power will be reduced on a monthly basis until the limit becomes Zero.
The tenor, or repayment, will be 6 months. So, irrespective of the amount you have availed, it needs to be settled in 6 months. The asking reducing drawing power will be higher if your application amount is high.
For example, if you have availed ₹1 lac as an overdraft against your CSP account, the monthly reducing DP would be ₹16666, which is pretty high. So, take utmost care while applying, as once the limit is set, it cannot be changed.
Purpose of an Overdraft account.
The purpose of an overdraft loan against the salary is for quick fund requirements.
At certain times, we need quick cash to buy some household goods such as refrigerators, televisions, washing machines, ovens, kitchen items, etc., which can be fulfilled with the OD loan.
This loan is somewhat linked to a consumer loan, which you have to liquidate within a short period of time.
How to apply an OD against my Salary?
You can apply online as well as offline.
To apply online, you need to have active Internet banking with full rights.
For online applications, the menu goes like this.
| Steps | Process to follow |
|---|---|
| Step 1 | Login to SBI Internet Banking. |
| Step 2 | Select Services and Requests found on the menu bar. |
| Step 3 | Select OD against CSP. |
Proceed further after selecting the above menu. You will know your eligible amount as per your account type.
Click on the confirm button.
An overdraft limit will be set in your account, which can be used right away.
To apply offline, you need to visit the branch where you maintain your salary account. There is a simple application form you may be required to fill out.
Along with the application, there are a few documents you need to submit. These are listed below:
- A copy of your office Identity Card.
- Latest salary slip.
- An ID card with a PAN card. The ID card may be an Aadhaar card, Driver’s license, Voter ID, passport, etc.
Once you have submitted the application, it will be sanctioned in no time.
Whether you apply online or offline, its processing does not take much time.
Online, if eligible, e-approval is instant, whereas when applied offline, it may take a few minutes.
Besides, the document requirement is minimal.
What OD Limit do I get?
The OD limit would be based on the type of CSP account that you have. It ranges from ₹40000 to ₹200000.
To simplify, here’s the chart.
| CSP variant | The eligible OD limit is up to 2 months of net monthly income, subject to the variant wise cap mentioned below. |
|---|---|
| Silver | ₹ 40000 |
| Gold | ₹ 75000 |
| Diamond | ₹ 150000 |
| Platinum | ₹ 200000 |
Online mode is available only for diamond and platinum variants of the Corporate Salary Package, in which the eligible limit is capped at ₹75000 and ₹ 1 lac respectively.
Other eligible criteria for the online channels are worth noting. These are mentioned below
- There should be salary credit in the account for at least the past 6 months.
- The online OD facility is available only for those who are in the diamond or platinum category.
- The applicant should be under 54 years of age.
Conclusion
The overdraft against the SBI CSP account is good for quick fund requirements.
It does empower you to get the benefit out of future salary. Its short repayment option makes it easy to liquidate of OD limit.
One need not worry about its repayment as the salary account itself turns into an OD account in which limit reduction is set monthly.
The reduced drawing power of the account is adjusted to the salary credits.
Overall, it is an excellent small loan for a salaried person.
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