Borrowing money from online loan apps may sound silly to some people. This attitude may be attributed to their fear of getting scammed because of their perceptions that online transactions involving money are problematic.
Online loans are helpful if you have a good purpose, especially for first-time borrowers. It may be used to consolidate your debt, finance a large project, or support urgent needs like medical treatment. It is the perfect option for those who have loans with varied due dates and interest rates. It is also ideal for those who have projects like home remodeling, purchasing furniture, or buying updated equipment for your home office setting. Online loans are the great aid to those who are looking for additional cash so they can push through with their plans as they may lose much more while waiting for money to flow in.
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To put it simply, you may use this opportunity to accomplish things which your savings could not cover. Online loans are paid in installments plus the accumulated interest. Checking your financial situation before taking out a personal loan is of great importance because the monthly payments will then add to your monthly dues.
The possibilities that you can do with the cash from the loan are endless. Taking out a loan is also beneficial as long as you can make payments on time. Here are the things that you have to know as a beginner before taking out an online loan:
Who are qualified to apply for a loan?
We have gathered this information from the most popular online loan apps today. These are the basic requirements for those who are applying for an online loan:
- Tala - 18 years of age, valid government ID, a smartphone with Tala Ph app
- Cashwagon - 18 years of age, valid government ID, proof of income of at least PHP 6,000
- Robocash - Individuals who are 21-70 years old, Filipino citizens, employed individuals, and selected professionals
- pera247 - 22 years of age, valid government ID, recent selfie, a smartphone with Pera247 app, proof of stable income is encouraged (especially for first-time borrowers)
What are the amounts and payment schemes offered in online loan apps?
Minimum and maximum loanable amounts vary if you are a first-time borrower or a repeat customer. There are loan app calculators available on their websites and apps which you can use to compute monthly repayments for your loan. Here are the loanable amounts for popular apps:
- Tala - Loan amount: up to PHP 2,000 for first-time borrowers, and PHP 10,000 for loyal clients, Interest rate: 11% for weekly payments in 21 days, 15% for a one-time payment in 30 days
- Cashwagon - Loan amount: up to PHP 20,000, Interest rate: up to 40% per month
- Robocash - First-time borrower: Php 1,000 to 10,000 payable for 5-15 days, one-time payment only on the given due date. With an interest rate of 1.5% daily interest.
- pera247 - Loan amount: up to PHP 15,000 for first-time borrowers, PHP 30,000 for loyal clients, and PHP 50,000 for shopping purposes, Interest rate: dependent on the applicant’s eligibility
How will I know if the online loan app is legitimate?
Legitimate online loan apps will only require you to send the requirements online and usually via mobile app. No fees shall be collected and paid for the application. Aside from that, make practice due diligence by checking their website and look for their SEC Registration number and Certificate of Authority to operate as a lending company. You may also ask one of their agents once they verify your application.
READ: Why You Should Not be Afraid of Online Loans
What will I do if I fail to make my repayment on time?
It is highly advised to settle your dues on or before the stated date to improve your credit rating. Late repayments are subject to fees charged by the Debt Collection Agency. You may also expect a third-party collection agency to contact and remind you via calls and SMS about your payment. Several late payments may result in bad credit rating which is traceable by other credit bureaus and databases.
Where do I claim my loan and make my repayments?
Most of the online apps send the approved loan via on your bank account, remittance centers like Cebuana, MLhuillier, or via G-cash. The transfer takes 24-48 hrs of notice and should be followed up diligently once the notification is received by the applicant. Take note that processing fees are already deducted in the amount that will be wired to your account.
We have all experienced at least once in our lives trying our best to stretch the money in our wallets as best as we could but there are days that you just need help. There is no shame in taking out loans using online apps as long as you know that you are managing your finances responsibly. Online lending apps are predatory like loan sharks which lend you money at a high-interest rate. Online loan apps are beginner borrower-friendly as it is easy to navigate and offers low-interest rates. Personal loans are also useful as it lets you purchase and do your projects right away compared to waiting for months and saving up for them. It saves you plenty of time in exchange for a small interest rate.