Why is almost everything being offered online? Filipino’s used to
feel hesitant when we say online, however, over the years we have
embraced the fact that it has become a necessity for us in the metro as
it proves to bring convenience and instant solutions.
When we need something such as food, new fashionable clothes, and
even personalized gift ideas, we go online and look for a shop that fits
our needs and wants.
If needs are offered on the web, of course, loans can also be
available online. Around 47% of Filipino adults have experienced
borrowing money from various lenders.
Different lenders offer loans that also vary depending on the nature
of borrowers they want to cater. Know which lender gives you the best
Filipinos’ Preferred Lenders
Family, relatives or friends (61.9%)
We love to think that our culture is family oriented and we can create close ties with friends. This is also a reason why most of the Filipinos can still borrow cash from family and friends. Aside from getting an extra cash with no credentials needed, there is a very high chance that you will not be charged with any interest rate, however, there is a very high risk that it comes with: trust.
Yes, all loans involve trust, but the trust of a dear friend or relative is something you want to keep for a lifetime. How many friendships have been wrecked by money?
There are also times when a Pinoy will expect “utang na loob.” This means when a person lends, it is expected for the borrower to also help the lender in case the situation has been reversed. Failurereciprocate the kind deed creates a deep crack in the personal relationship that might never be mended. You might end up still financially unstable with one less friend.
Lending/financing companies (12%)
There are Filipinos who would prefer getting a loan from a lending or financing company rather than letting people around them know the financial difficulty they are in especially if the reason they need some cash might not pass up as important to other people.
A cooperative is a non-government association of people who voluntarily made a group due to same interests. The credit cooperative promotes savings to its members and also offers financial services. However, it only gives loans to their members.
Informal lenders (10.1%)
Informal lenders are unregistered lenders who charge interests as high as 20% or more. It is very easy to get your loan approved, such as in “5-6,” though you have to get ready for astronomical interest charges. If you get a loan from a loan shark, expect to pay about 100% more on top of your capital loan if you miss a couple of paying dues.
Microfinance NGOs (9.9%)
Microfinance NGOs offer financial services for the poor and low-income Filipinos who want to make a livelihood. Small loans are offered as mandated by Republic Act No. 8425 known as “Social Reform and Poverty Alleviation Act.” Microfinance NGOs must also be registered with Securities and Exchange Commission (SEC). If you don’t fall in the poverty line, then you can’t get a loan from them.
Government entities (6.1%)
These include SSS, GSIS, and PAGIBIG. These government entities may give loans to Filipinos who have been members for a couple of years and have been constantly contributing every month. Though these are government institutions, we know that it takes a long time to get approved.
Seven out of 10 Filipinos think that the bank is accessible but only five out of 10 actually had actually experienced transacting with this institution. Most Filipinos believe that banks are very strict when approving loans which are usually secured. This creates a notion that only Filipinos with assets can easily get a loan from banks.
Steps to Apply for an Online Loan
According to the studies of Bangko Sentral ng Pilipinas (BSP), the second most known source of borrowed money are lending companies. What makes getting a loan easier from these companies is that many of them started utilizing the web to reach more clients and make their services readily available.
Step 1: Know the amount you need and its urgency
When applying for an online loan, you must be sure that you really need it. Getting a loan is getting a serious responsibility. Take time to consider how much you really need and the urgency of your situation. You can actually get cash from an online lender in one to two days.
Step 2: Shop around for a reliable lender
Chances are, you will stumble upon a couple of online lenders in the web. How will you know which one is a responsible lender and which one is a scum?
Check the Website Security
Carefully look at the website’s address. There has to be a small green lock icon and the link address must start with “https” which means it is using an SSL Certificate. For a company to have an SSL Certificate, it has to go through a strict validation process.
Look at the Domain. There are cyber culprits who create fake websites that look very similar with the real ones. Carefully look at the domain. Check the spelling of the words. If there seem to be some discrepancies, give the company a call or a message through its email to validate the website.
Is the company real?
- Physical address and phone number
A real online lending company has a physical address. Though they may not require their clients to go to their office to finalize the loan process, except that they operate in an office. You can also get a real phone number. Try calling it to confirm if it actually works.