Paytm vs PhonePe: Which UPI Loan Feature Is Better in 2025?
In 2025, India’s digital payment apps have evolved beyond simple money transfers. Both Paytm and PhonePe now offer Instant UPI Loan services, enabling users to access quick personal loans directly through their apps. This feature is especially useful for young professionals and small business owners looking for instant credit solutions.
What Is the UPI Loan Feature?
The UPI loan feature allows users to apply for a personal loan via the app with minimal documentation and a fully digital process. Loan approval and disbursal typically happen within a few minutes, making this a fast and convenient option compared to traditional banking loans.
Paytm UPI Loan Features
- Loan approval time: 2 to 5 minutes
- Required documents: Aadhaar, PAN card
- Loan amount: ₹1,000 to ₹50,000
- Interest rate: Starts at 12% per annum
- NBFC partners: Clix Capital, Aditya Birla Finance
PhonePe UPI Loan Features
- Loan approval time: 3 to 7 minutes
- Required documents: Aadhaar, PAN card, complete KYC
- Loan amount: ₹2,000 to ₹60,000
- Interest rate: Starts at 11.5% per annum
- NBFC partners: L&T Finance, KreditBee
Comparison Table
| Parameter | Paytm | PhonePe |
|---|---|---|
| Loan Amount | ₹1,000 – ₹50,000 | ₹2,000 – ₹60,000 |
| Interest Rate | From 12% | From 11.5% |
| Processing Time | 2–5 minutes | 3–7 minutes |
Which Is Better?
If you are searching for quicker processing and need a moderate loan amount, Paytm is a suitable choice. However, if you prefer a higher loan amount and a slightly lower interest rate, PhonePe may be more advantageous.
Frequently Asked Questions (FAQ)
1. Are loans on Paytm and PhonePe safe?
Yes, both platforms provide loans in partnership with RBI-registered NBFCs which ensures safety and regulation compliance.
2. Is a good credit score required for taking UPI loans?
Yes, most lenders require a minimum CIBIL credit score of 650 or above for eligibility.
3. What happens in case of loan default?
If you default on repayment, there will be penalties and your credit score can get negatively affected.
4. What documents are typically needed?
Usually, you need your Aadhaar card, PAN card, and need to complete KYC to get instant approval.
5. Can self-employed individuals apply for these loans?
Yes, both salaried and self-employed users can apply if they meet the eligibility criteria.
Conclusion
Both Paytm and PhonePe offer fast, user-friendly instant UPI loan options. The best choice depends on your specific needs, desired loan amount, and preference for processing speed or lower interest rates. Always review the terms and ensure you can repay the loan on time to maintain a good credit score.
