Loan companies operate outside the banking sector and grant loans on a much smaller number of formalities than required by the bank’s credit process. However, it is a mistake to say that such companies will grant loans to everyone, without exception. Taking care of your loan portfolio, the majority of respected loan companies operating on the Polish market pay loans responsibly. This means that to some extent it examines the customer’s creditworthiness and controls whether he has debts due to other financial liabilities.
The advantage of perosnal loans from companies operating outside the banking sector is, among other things, that you must meet the minimum formalities to obtain them. In many cases, a copy of the ID card and loan application is enough for the lender to consider whether to grant a loan to the client or not. The lending process in banks is much more complicated and often requires submitting a whole bunch of personal and financial documents so that the bank finally calculates the customer’s creditworthiness and issues a credit decision.
The loan application, with personal details provided, identity card number, bank account number, telephone number and number is the basis for granting the loan in most parabanks. However, there are also borrowers who will require additional documents to be able to grant loans.
Such documents include ID card or other document with photo, statement or certificate on the amount of income obtained, certificate from the employer about employment or a copy of the utility bill from the last period. Going a step further, the lenders are asking to send a copy of the last PIT tax return or agreement with the bank with which the client has signed a personal account agreement. If the borrower earns income not from work but from a business, disability or retirement pension, the formalities required by the parabank may be slightly different.
The lender may require a decision on the award of a retirement or disability pension, the last pension or company account statement and a certificate from the register of entrepreneurs.
It all depends on the internal policy of the parabank where we want to take out a loan. It can be obtained online without showing many documents, but most often such a commitment will be more expensive than the one granted by the loan company that carries out a meticulous credit process based on the documents presented by the client.
Becoming an adult is usually not enough to take out a payday loan. Despite the fact that being 18 years old decides that a given person will acquire full legal capacity, the lender may not decide to lend money to such a person. The vast majority of loan companies require that the borrower is at least 20-21 years old when submitting the loan application. Few companies are willing to grant a loan to a person aged 18-19. There is also an upper age limit for which loans are granted. The customer cannot be more than about 65-70 years old at the time of repayment.
Parabanks in Poland, regardless of whether they provide payday loans online or during a personal meeting with a client, direct their offer only to citizens of the Republic of Poland, who have permanent residence in the country. Therefore, foreigners cannot successfully apply for a loan from a non-bank company.
The requirement for borrowers is also to have a mobile number registered for a specific person and to have a bank account in the name of the borrower. Both the telephone and the bank account are used to verify the identity of the applicant for the loan. Therefore, the bank account from which the customer makes the verification transfer must be registered to the borrower.
In addition, before granting the loan, the company will check whether the person is not listed in the debtors’ database – in BIG or KRD.
In addition to the interest rate on the loan obligation, loan companies very often place information on the APRC loan. This parameter can be even several or tens of thousands of percent. Customers have problems with its interpretation, because the interest rate offered on a given loan by a parabank is usually much lower. Meanwhile, the APRC is the abbreviation for Annual Real Interest Rate. This is a measure of the cost of credit as set out in the Consumer Credit Act. It includes all the costs of the loan, not just the interest rate itself, which currently cannot be higher than 16%. per year – four times the Lombard rate of the National Bank of Poland, determined by the Monetary Policy Council.
The actual interest rate on a loan or credit is more reliable than the nominal interest rate, as it also includes all fees that the borrower will have to pay.
In the bank offers, the APRC is mandatory, but loan companies also indicate the same factor in their offers. APRC allows for effective comparison of loan and credit offers. The APRC amount is influenced by the interest rate on the loan, additional costs incurred by the borrower and the time value of money. Even if the lender did not charge any additional fees, but only interest, it would not be equal to the APRC.
With payday loans, even several thousand percent of APRC does not mean that the customer is forced to give the lender a multiple of the amount borrowed. Usually loans of this type are granted for a very short period of time, for example for 15 or 30 days. So if we borrow PLN 500 for 30 days and return PLN 650 to the parabank after a month, this does not seem to us a large amount. However, when we convert 150 PLN fees and interest on an annual basis, it turns out that the APRC is over 3000 percent.