With the influence of the Covid-19 epidemic affecting the economy, businesses and especially each citizen, the consumer lending sector is also moving to adapt to the new situation.
Consumer lending" about 20 decades ago was still a "relatively new" concept for the operations of credit institutions in Vietnam. But just a few years ago, consumer lending has become the target of many credit institutions, especially non-state ones.
Along with the strong economic development, the people's living standards have been significantly improved. The demand for spending to serve life is increasing, which is a favorable condition for banking operations in general and the development of consumer lending in particular.
So what is consumer loan? Features and benefits like?
Consumer lending is understood as a form of financing for the purposes of individuals and households. Consumer loans are an important source of finance to help consumers cover the needs of life such as housing, transportation, living facilities, study, travel, health ... before when they can afford to enjoy it.
Therefore, consumer lending has its own characteristics that are different from bank credit in general:
- Borrowers are individuals and households.
- The purpose of borrowing to serve the consumption needs of individuals, households is not derived from business purposes. Therefore, it depends on the needs, personality of each customer object and the economic cycle of the borrower.
Consumers' borrowers are often less interested in interest rates, but more about the amount they have to pay.
- Regarding interest rates, because the size of loans is usually small (except for loans to buy real estate), leading to high cost of loans, so consumer lending rates are often higher than lending rates. Commerce.
- The source of customer debt repayment is extracted from income, not necessarily from the result of using those loans.
- Clients with jobs, stable incomes and education are important criteria for commercial banks to decide to lend.
Consumer loan installment is a form of borrowing from a bank or finance company, while borrowers do not have to mortgage any kind of assets. Instead, the borrower will have to pay both principal and interest monthly.
In which, the principal payable is the same for all periods. Interest is charged by the bank at the required percentage based on the amount borrowed. There are two types of interest rates, the fixed rate or the descending balance rate.
Form of consumer loan installment installment:
- The first form: Customers get loans directly at branches, head offices or transaction offices of the banks. In order to get a consumer loan, customers must complete the application and send it to the bank.
The Bank will approve the application and disburse it after 1 to 2 working days if the application meets the loan conditions.
With this method, customers can borrow money according to salary; loans under life insurance; borrowing money under electricity bills or getting loans under a business license.
- The second form: Customers borrow indirectly when buying products and services from partners associated with the bank.
For example, when you buy a phone at a bank-affiliated store, you may only need to pay 30% of the value of the product in advance. The remaining amount you can pay by installments at the specified interest rate.
The purpose of installment consumer loans:
● Borrowing money to buy furniture and household appliances
● Installment car loan, telephone, electronics, electronics
● Borrow money for home repair and decoration
● Borrowing money for traveling and studying
● Loans to pay for spending, beauty care, health care, weddings, ...
Benefits of installment consumer loans :
● Little restrictions on the amount of money borrowed: The loan amount can be up to half a billion.
● Fast, convenient: Buyers can have products to use right away without waiting as long as a mortgage loan.
● Flexible repayment period: Customers can choose a long or short repayment period. Usually it can be paid in full within 3 months or 60 months depending on the loan amount.
Unsecured loan is a form of loan without collateral, customers only need to prove their legal entity and income to get a loan from a bank / finance company. This form of non-mortgage consumer loans have a higher interest rate than mortgage loans (2 to 3 times higher). Low loan approval amount.
Benefits of non-mortgage consumer loans:
● Unsecured loan: No need to mortgage collateral.
● Simple application procedure: Customers provide simple personal papers.
● No need to pay attention to the details of the loan purpose: You do not need to disclose the details of the use of your loan, as long as it is for consumer loan purposes, the credit institutions are interested in the your payment more.
● High loan amount: You can easily get a quick loan with the maximum loan amount up to VND 500 million. There are banks to support up to 1 billion.
Consumer mortgage or mortgage loan is a form of bank loan, customers use collateral to get the bank's approval to lend. This method helps customers to access a larger unsecured loan and has a much lower interest rate than unsecured loans.
Banks usually only deal with large loans. These are loans with a clear business plan, legitimate consumption and procurement purposes.
Benefits of mortgage consumer loans:
● Large loan amount, maybe 50 million VND to 5 billion VND. How much this amount depends on the purpose of your loan, depending on the rules of each bank and the value of the collateral. Usually the amount that banks can lend is up to 70% of the collateral value.
● The average interest rate for mortgage loans fluctuates from 14% - 16% / year, lower than unsecured loans.
● Maximum loan term lasts up to 15 years.
It can be said that consumer loan packages from banks, allowing high-value loans with preferential interest rates, are alleviating the worry of financial arrangements for large expenditures to serve the consumption needs of people. .
However, in order for the recording to proceed smoothly, please note the following tips!
- Select a reputable loan address
Choosing a bank with attractive consumer lending rates is always one of the first factors for customers to "choose a loan side".
- Consider the form of loan, interest rate and related costs
However, in addition to competitive consumer lending rates, customers also need to pay attention to a number of other factors to balance their ability to pay in the future, such as loan types, loan terms and non-interest fees.
Specifically, banks currently provide loans for personal consumption in two forms of mortgage and unsecured loans.
According to a survey of CashBerry, each form of loan will have its own advantages, the main difference in terms of limit, interest rate, loan term and loan procedures.
Because in essence, these two types of loans actually satisfy different needs, so whether you decide to take a mortgage or a mortgage depends on the situation.
+ If a customer has a need for a low-value loan, they should borrow unsecured loans because of simple procedures, the interest rate can be calculated on a daily basis and according to the decreasing balance, it will be more beneficial. + If you borrow investment capital, buy a house, buy a car, ... you need to borrow a mortgage to get a high limit, a more reasonable interest rate and a long loan term.
- Look up information carefully
Actively looking up interest rate information at banks and contacting bank advisors is not a bad idea if the customer has not chosen a bank like that.
In addition, customers should choose to borrow in packages to enjoy many policies on prices and service charges. Because, each loan depends on the bank will have fees in addition to interest.
- Know the loan terms
In addition, no matter what loan is at the bank, customers also need to meet a number of conditions to ensure safety and control risks. Therefore, by heart, the conditions for personal consumption loans will help customers be more convenient and save time and effort.
- Compare to take advantage of many offers
In fact, there is no common denominator in personal consumer lending because it depends on many different factors, mainly on the needs and affordability of the customer.
Currently, consumer loan groups are divided into two groups by credit institutions and banks based on their income (including high, medium, and low income) and working status (employees employees, business people, freelance workers…).
Capturing the needs of customers, banks and finance companies are focusing on deploying many products for personal consumer loans. Especially at many banks, personal consumption loan packages are being offered preferential treatment with competitive interest rates. Therefore, searching and comparing to find the right financial package will also help customers take advantage of many incentives.
+ For example, Vietcombank has a personal consumer loan product with collateral in the program "Competitive interest rates in 2020", with interest rates from 7.2 to 7.7% / year, depending on preferential time.
Currently, Vietcombank is implementing the program with loans up to 1 billion VND and loan terms up to 120 months. In addition, customers also receive a 25% discount on food bills at some restaurant chains.
Meanwhile, Techcombank has a unsecured consumer loan package with a limit of up to VND 500 million, with interest rates from 0.6% / month (equivalent to 7.2% / year). Customers can borrow by salary, utility bills, other old loan contracts, life insurance, ... by online form.
+ Similarly, Sacombank also has a consumer credit package with interest rates from only 11% / year; Loan term up to 20 years. Not only that, Sacombank also implemented many different consumer loan packages such as FMCG, retirement consumer loans, consumer loans for state employees, to meet the needs of many other groups of customers. each other, the loans are supported quickly and promptly.
However, you know, when it comes to "bank loan", what will you think of immediately?
+ Wait a long time, take time
+ Procedure cumbersome
+ Difficult enough way
Therefore, if you need some money to spend in the day, the bank is not the right choice for you.
Loans for personal consumption online or online loans with the advantage of a simple, quick-and-fast procedure, are currently the method of borrowing money that many people choose. Just visit the website https://cashberry.vn/ or download the CashBerry App to your phone, perform a few simple steps, you can receive money in just 30 minutes.
Advantages of online fast money loan service:
● Easy to register online and confirm information by phone.
● Get money fast during the day.
● Quick loan amount from 500k - 10 million dong or more depending on your personal reputation and credit history.
● Information about interest rate, payment term is displayed transparently on the contract.
● No need to mortgage assets, no need to prove income, no complicated papers.
* So who is CashBerry? Is it reputable?
CashBerry is a unit specializing in consulting and providing fast online financial solutions in 24 hours with safe, simple and reliable procedures.
The highlight of CashBerry is that you get a quite low interest rate of 10.95 - 14.6% / year .
CashBerry offers you loans from 500 thousand to 10 million dong .
Just fill in simple information online in 5 minutes, after 15 minutes you will be disbursed into your account quickly. The payment process is also quite simple online.
● Internet phone access
● Be a Vietnamese citizen with a valid ID / Passport
● Age: 18 years and over
● The monthly income is stable
Register here: Consumer loans - Financial solutions for modern life
Besides, to ensure your interests, when borrowing money quickly , you should not ignore the notes below.
● Read the contract carefully
Lending conditions are now more open with many attractive incentives, but there are certain binding conditions. Therefore, the borrower should read the contract carefully. You need to pay attention to the terms, especially the interest rate change term.
A client must ask a customer relations specialist to advise him very carefully, if according to the terms of the contract, how much interest will it be.
Thus, the financial institution and the customer build a long-term relationship, while also avoiding potential risks for both parties.
● Learn about repayment methods
Depending on the financial unit, the bank, there are different repayment methods. You need to learn about repayment methods to plan your financial ability.
● Take advantage of incentive programs
Borrowing means you have to pay debt plus interest. Therefore, it is necessary to take advantage of preferential interest rate loans or privileges to reduce the burden on yourself. However, borrowers also need to be cautious about loans during promotions.
With banks today, there are many forms of lending that are quite easy to attract borrowers such as: unsecured loans, life insurance loans, electricity bills ....
* * * The cheapest loans are at the end of the year promotions, unsecured borrowers need to be alert to loan conditions, fees such as prepayment, late payment fees. Especially, in each preferential interest rate package, there is only one period, followed by the floating interest rate.
So do not be too greedy for the initial interest rate during the promotion period but forget about how much interest rate will be applied after the time, borrowers need to ask carefully in detail to plan for repayment and repayment. be in debt. Do not let when you have to incur floating interest after the promotion to suffer because the terms of the contract do not pay attention.
But considering that this is not a trap created by one side but the borrower does not pay attention to it. Because individual customers, the assessment of the solvency or not is very low, while the loan is not too large, leading to if there is a mistake, the cost of filing a lawsuit is quite large, so this is also. is the risk of the bank.
Therefore, before deciding to borrow consumer loans, borrowers need to carefully consider the factors of solvency, and is it necessary to use the loan or not? Do not because seeing low interest rates but jumping in to borrow is also facing a rare situation because many customers do not really want to borrow but see low interest rates and jump in. If the level is necessary to borrow, customers should actively consider carefully in addition to the preferential interest rates, how the post-promotion interest rate will be calculated should be specified in the contract.
● Do not take too much loan
You can take out a large loan to buy a house, but can you pay the monthly interest plus capital to the bank?
Borrowers must analyze in detail their daily expenses (meals, gas, school fees for children, money for buying things, money for traveling ...). In addition, the borrower has to pay interest and capital to the bank, monthly.
After listing all your loans, you will find out how much you should borrow to suit your financial situation. In fact, many customers with an income of about 12-15 million dong a month have difficulty because they have to pay more than 10 million dong in principal and interest when buying an apartment with too high price.
● Plan the ability to repay debts in the long term
When borrowing capital with extended term, the interest rate will be adjusted to increase or decrease depending on the market situation and each bank's policy. Without careful preparation, borrowers will be put in a passive position because there is the possibility that interest rates will increase over time.
Therefore, you need to estimate your solvency before deciding to borrow. Customers should consider interest rate conditions and monitor interest rate fluctuations in the market to anticipate whether a large amount of money or principal debt can be paid off for a long time.
● Early payment fee
Prepayment is a way for the borrower to reduce interest costs compared to the original payment sheet when signing a credit contract (as this results in the bank losing an interest rate compared to when the borrower maintains it). the loan is due). Prepayment fee is calculated as a percentage (from 1% to 5%) of the total outstanding balance at the time of payment.
● Late payment fee
When your payment is late compared to the periodic payment time in the signed contract, you may be charged fee for late payment. Plus, there are two possibilities.
First, banks can resort to the law. Second, the bank subtracts from your bank account (if the same bank) to pay off your debt. If you have opted for a mortgage loan, the bank can take your assets back to secure it to be released.
Considering the online consumer loan interest rates of financial companies, they are higher than banks!
Why consumer loans at finance companies have higher interest rates than banks?
This is a question that many people wonder, with CashBerry to find out!
Consumer lending is a form of unsecured lending based on personal reputation without any collateral in terms of assets.
Therefore, unsecured consumer loans will always contain high risks, so the risk premium in the factor that constitutes interest rates must therefore be higher than mortgage loans made by commercial banks. are applying.
Below is a table comparing the different basic criteria between the two lending services:
|People with low incomes below 3 million, no need to mortgage assets.
|People with annual income from above, have high credit scores, have good credit history, and have secured assets.
|The procedure is quick and simple, just ID card and household registration book can be disbursed in a short time.
|The process is complicated and requires more paperwork such as proof of repayment capability. Disbursement time is long.
|Meeting diverse loans from small to 70 million
|Minimum loan limit is from 10 million to 500 million
|Serving the needs of individuals and families such as household appliances, personal items, motorbikes, electronic devices, ... with a flexible variety of services.
|Satisfying large loans such as business, buying a house, buying a car ... so the audience is often quite narrow.
Therefore, when accessing loans, consumers need to clearly identify the different modalities, to avoid inadequate comparisons. Obviously the product and target audience of the two types of loan are completely different.
Moreover, a very large part of the impact on the interest rate of financial companies is that financial companies are not allowed to raise capital from individual customers, so the consumer loan of finance companies often have higher deposit costs than that of commercial banks.
In addition, with the advantage of simple procedures, quick disbursement, loan conditions are easier than commercial banks, the loans of finance companies are easy to reach most people in need. Quick loans, avoid being exploited by "black credit".
This puts enormous pressure on the operating costs of financial companies. Because with a small loan, short term (about 6 - 18 months), the cost of appraisal, documentation and procedures as well as a normal loan; in addition, the cost of debt collection, management, and service fees are all higher than normal ... This is a factor that significantly impacts interest rates on loans.
With the aim of responding to all the needs of consumers quickly, CashBerry constantly improves the quality of loan services, pioneering the application of technology. At the same time, with the CashBerry application (App CashBerry), people can access loans and disburse quickly, wherever they are. This is the success of CashBerry in constantly improving the user experience and meeting the needs of customers anytime, anywhere.
Today, take your dream vacations, study abroad to expand your knowledge, buy a car or redecorate your home.
To see that life is worth living!