Many people are very happy to use free payday loans, which are offered by most lenders. However, this form of loan will not be appropriate for everyone, and instead it will be better to pay back the liability in small monthly amounts.
The obstacle, however, is that installment loans are unlikely to be free, even for new customers, which is partly the result of the general characteristics of the product as well as the diversity of the offer and costs.
However, this does not mean that we have no chance of obtaining such a loan. Let’s see where and under what conditions we will receive a free installment loan.
Free payday loan is available immediately
Lenders who have a free payday loan in their offer follow a set strategy that is not only to build a positive image of the lender, but also to familiarize the public with this type of product and perhaps encourage them to use them more often, even with the same lender . If the loan works and the borrower needs a higher amount or a longer repayment period – he is likely to submit the application again. So it will be a profit for both the company and the borrower.
It should be noted that providing a free payday loan is not a big risk and burden for the lender’s company. This is a short-term commitment that should be repaid after a maximum of several dozen days – usually 30 or 60. The capital borrowed will quickly return to the lender, and if not, it will be increased by the costs due for a standard loan.
Installment loans more expensive for both parties
An installment loan is a completely different product. It is true that it is eagerly borrowed by borrowers who have less creditworthiness than payday loans, but also do not attach the client to one company and if necessary, the client can always use the services of another company. This is advantageous mainly because most installment loan companies make it possible to borrow the highest loan amount the first time.
The additional burden on the lender will also be that the loan is granted in large amounts (up to USD 15,000 in Hapi Loans and USD 20,000 in Wonga), but the capital and interest is cyclically given in small installments even for several years. There is a higher risk of losing money and higher costs of loan management. What’s more, in a few years the customer can borrow in one company only once, and at the same time he could take even a few payday loans!
4 × 0 start loan in Provident
A real installment loan that can be paid out in monthly installments instead of within 30 days is a loan from Provident. It is true that it is also available as part of the promotion, but it seems that the company’s offer has already become permanent.
It can only be used by new Provident customers who have not yet used either the Self-Service Loan or the Match Loan. In this way, however, they can borrow only a limited amount, only USD 1,500 to be repaid within 4 months. The loan installments, if each of them will be repaid on time, will consist exclusively of capital, without additional costs.