“Small businesses are the engine of growth in their communities, generating wealth creation and upward economic mobility. When these are successful, our economy becomes stronger, more egalitarian and resilient”
Mini loans or micro loans are an incredibly popular product nowadays. Small amounts that lend themselves to make a small project a reality, cover an emergency or a specific need.
A microcredit is a loan aimed primarily at people who want to be self-employed.
These loans are given to people to help other people. Therefore, we love to be intermediaries of this type of products. When a need arises in your life, we put at your disposal the best technology to compare loans and select the most appropriate to your case.
We want to show you how well our loan management system works. Regardless of the amount you need, we are convinced that we can bring you positive things.
Small loans: advantages
Small loans are really useful to plug small holes or deal with unforeseen events. We are facing a very popular financial product and that can be contracted easily and quickly, so you can get the money you need in just 24 hours. Do you know its advantages ?
Advantages of small loans
If at any time you need a liquidityshot, small loans can come in handy.
What is a small credit?
Before we go any further, what is a small loan? Mini loans or mini quick credits are called that because the amount is usually really low. While the return period is usually about 1 month.
Although each financial institution can provide it with different characteristics, they generally refer to very small amounts that are received quickly in the account and that must be returned quickly.
Characteristics
Why are mini credits characterized?
- Very small amounts can be requested that would not be available with a normal loan, given that there are maximum and minimum limits.
- It is generally not necessary to have a guarantee – being low amounts, the risk for entities is small and they ask for little paperwork
- Interest may be higher than other types of loans
- Grace periods tend to be more flexible
- For individuals or companies
These are some of the main features of this product. However, keep in mind that each financial institution can detail its own.
Advantages
If small loans are characterized by something, it is because they have a multitude of benefits. They are a financial product available to virtually anyone and truly versatile:
- Speed:one of the great advantages of hiring a mini credit is that the procedure is practically instantaneous, faster than any other type of financing.
- Less paperwork:the lower the risk due to the amount ordered, the less paperwork you will have to collect. That is, fewer headaches.
- An option always available:usually, it is something that you always have there at your disposal when you need to plug any hole or deal with any unforeseen event.
- Customizable:often this product can be customized based on your needs, to modify the amount or term as it suits you best.
There are two types of microcredit
That’s right, before applying for a microcredit, it is important to be clear that there are two types: individual and group. The first is very similar to any loan, so it is necessary to have a guarantee or collateral for the credit to be authorized. In the case of the second type of microcredit, a guarantee is not necessary or the alternative is to form groups of five or more people.
Among the characteristics of these micro loans, the following points stand out:
- The people in the group must know each other and have confidence in each other.
- An individual loan is granted to each of those who make up the group.
- Payments are made on a weekly or biweekly basis and the group meets to collect the payment.
- If one of the members does not comply, the group is responsible for the payment, that is, the guarantee is solidary .
- In case any of the members fail to comply with a payment, all members will be reported with a negative note
It is advisable to evaluate the commitment that is acquired with a microcredit against the economic possibilities of people to ensure that they have sufficient resources to settle their debt. Otherwise, they will end up hurting your credit history, making it difficult to access other types of financing.
If you have already evaluated all the alternatives and the solution at this time is to request one of these microcredits, make sure you sign a contract,carefully review the conditions under which they grant it, understand each of the clauses and do not miss what is the interest rate that will apply in your case. Also investigate what are the fines that apply for delays, as well as the dates and conditions of payment, no question is too much when it comes to money and your financial peace of mind.