How to Become a Loan Counsellor

About Loan Counsellor

A Loan Counsellor is a person who helps a potential client or borrower find the best loan and scheme for their needs. Loan counsellors act as the intermediary between the borrower and the bank or financial institution and provide information about the various loan schemes offered by the financial institution while also offering guidance on selecting the best loan schemes. The responsibilities of a loan counsellor are not only limited to new and prospective clients. They also have to help existing borrowers to manage their loan repayments and address any issues while also adhering to the policies issued by the lending institution.

A loan counsellor is also responsible for checking the financial history of the borrower, verifying the documents and other information submitted by the borrower and process the loan application. A loan counsellor should be able to explain all of the details and terms associated with the various loan products offered by the financial institution to the borrower. In addition, a loan counsellor must also be able to analyze the financial requirements and potential of the borrower and suggest the schemes that would be the most suitable on a case-by-case basis.

In order for a loan counsellor to be able to do their job properly, they should have a good knowledge of finances and financial products. Loan counsellors should also have a good analytical ability in order to analyze the financial portfolios of a borrower. In addition, they must be proficient in communication skills and have a working knowledge of computers and accounting software.

Eligibility to become Loan Counsellor

In order to become a loan counsellor in India, a candidate must have at least completed a bachelor’s degree course in a stream related to finance, accounting, economics, commerce etc. Banks and other financial institutions also prefer candidates who might have some work experience in related roles for this position.

The following courses can be considered by a candidate who wishes to take up a career in loan counselling.

Undergraduate Courses for Loan Counsellor

• Diploma in Banking and Finance

• Bachelor of Business Administration (BBA) General

• BBA in Banking and Finance

• BBA in Finance

• BBA in Accounting

• Chartered Accoutant etc.

Postgraduate Courses for Loan Counsellor

Usually, a bachelor’s degree is sufficient to help a candidate start a career in this field. However, candidates who wish to explore better job opportunities and accelerate their rate of career growth can also go for postgraduate education. The following postgraduate courses for loan Counsellors can be taken up in India.

• Master of Business Administration (MBA) General

• MBA in Finance

• MBA in Banking and Finance

• Post Graduate Diploma (PGD) in Banking and Finance etc.

Types of Job Roles Loan Counsellor

A loan counsellor has to undertake various responsibilities as part of their job. It is very important for a loan counsellor to perform all of the tasks assigned to them carefully as they deal with financial matters. Given below are the responsibilities and tasks assigned to a loan counsellor.

• Providing all of the information regarding the loan schemes offered by a financial institution and answering any client queries.

• Analyzing the financial status or a borrower to determine the appropriate loan amount.

• Verifying the information submitted by the borrower and approving loans within the limits as per the needs, financial status, mortgage value etc.

• Determining and explaining the best loan schemes and repayment options for the borrower.

• Manage the accounts of existing clients.

Financial institutions usually have different loan schemes for different sectors and hence, depending on the sector a loan counsellor is working on, they may have different job profiles. Given below are the different types of job roles available for loan counsellors in India.

• Education Loan Counsellor

• Home Loan Counsellor

• Personal Loan Counsellor etc.

Employment Sector/Industry for Loan Counsellor

Loan counsellors are either hired by organizations or companies that either directly provides loans or facilitate loan applications and products. Positions for a loan counsellor might also be open in organizations that sell products or services that might require a customer to apply for a loan. In such scenarios, loan counsellors discuss payment plans with the customer and then might help the customer apply for loans to a relevant organization.

Given below are the top areas that loan counsellors.

• Banks

• Non-Banking Financial Institutions

• Financial Consultancies

• Banking Service Aggregators etc.

Top Recruiting Companies for Loan Counsellors

Some of the top recruiting companies for loan counsellors can be found given below.

• State Bank of India

• Bank of Baroda

• Bajaj FinServ

• Axis Bank

• Muthoot Finance etc.

Pay Scale/Salary of Loan Counsellor

The salary of a loan counsellor usually has a fixed component and a variable incentive-based component or bonus, which depends on their performance. The fixed salary component for loan counsellors is usually a bit low but professionals are able to get a good take-home salary through incentives and bonuses. Given below are the details regarding the salary of a loan counsellor in India.

• The starting salary of a loan counsellor can be around Rs. 14, 000 - Rs. 16,000 per month.

• With some years of experience, loan counsellors can earn average salaries ranging from Rs. 3 - Rs. 4 LPA i.e. Rs. 20,000 - 30,000 per month.

• The senior-level salaries for loan counsellors usually are around the range of Rs. 6.5 to Rs. 7.5 LPA.

Candidates must note that these are fixed salaries and loan counsellors can earn incentives based on-target completion.

Books & Study Material to Become Loan Counsellor

Candidates aspiring for a career as a loan counsellor can refer to some of the best books in the field which are given below.

• Home Loan Counselling by Indian Institute of Banking and Finance (Taxmann Publications Private Limited)

• Understanding How to Handle Home Loans by Sachin Mittal

• Credit Appraisal & Analysis Of Financial Statements by R.K. Gupta (Notion Press, Inc)

Pros of becoming a Loan Counsellor

• The field does not necessarily require a high investment in education. A bachelor's degree course is sufficient to get you into this career.

• The career provides good opportunities for networking and is highly suitable for candidates who have good communication or marketing skills.

• Loan counsellors develop a good understanding of financial products.

Cons of becoming a Loan Counsellor

• The salary is not that attractive if one does not count the incentives.

• The targets are usually high and professionals have to strike a balance between target completing and providing fair financial plans.

• The job can get stressful.