How To Get Emergency Funding

A large number of people are under financial stress due to lockdown and market crash. Here are some avenues for raising money with ease

- Naveen Kumar

These are tough times for people across the country due to lockdown. One reason is that many citizens were unprepared for its impact on our incomes and were caught off-guard. While the government has come out with many schemes to support those in lower income groups, the only relief the middle-class has got is moratorium on payment of EMIs till May. While most self-employed people are facing a huge disruption in business and income loss, things are not much better for many salaried employees either due to delay in payment of salaries and, in some cases, even pay cuts and job losses.

The first impulse of a person facing a financial crunch is to approach a bank for a personal loan. However, there are a host of other options than a personal loan.

Understand Your Requirement

The first thing you should be clear about is the nature of your need. Is your expense avoidable at this stage? If no, can you ensure spending of as little amount as possible? And, is your problem temporary or are there chances of income disruption lingering on for a longer period?

If the disruption is likely to continue for a longer period, it is better to liquidate investments rather than take a loan, and opt for a drastic cut in both discretionary and day-to-day expenses. Avoid borrowing till your income prospects improve. Take a loan only if you are sure about your future income and repayment capacity.

Your Options – And Their Cost