Market lending options are broad, do you agree? There are several financial institutions that cater to different profiles, with attractive repayment terms and small fee promises.
However, the choice of your choice should be guided by careful consideration. So to help you out, we have listed the main types of loans and the advantages and disadvantages they can offer.
Loans for individuals
1. Personal loan :
This is one of the most popular and recommended loan types for people who need fast cash. Once passed the credit analysis, the individual can receive credit within 24 hours.
However, its biggest disadvantage is the high interest rates. Personal loan charges can reach 26.64% per month, in contrast to the 4.86% per month (October / 2019 figures) of the private payroll loan.
2. Payroll Loan :
The payroll loan is also suitable for people with employment or retirees and pensioners of the INSS. Its main advantage is the low interest rates as exemplified above.
This type of loan has little flexibility as installments are automatically deducted from payroll. In an emergency situation, for example, you cannot afford to pay one of the installments.
3. Overdraft :
Considered as an “extra money”, the overdraft is available in the checking account, pre-approved, and can be used at any time, without having to look for an agency in person.
When using this limit, whenever a value is credited to the account, the bank considers it as payment of the overdraft balance. In addition, the Financial Transactions Tax (IOF) and interest that can reach 512% pa (October / 2019 values) are paid.
1. Overdraft :
This type of loan can be used by individuals or companies. The amount of overdraft varies according to the registration information and the client’s financial history.
2. Working Capital :
Working capital can be defined as current assets that are used to settle the company’s basic accounts. Some financial institutions lend this feature to help companies that are in crisis and / or want to reorganize their cash flow.
Disadvantages of this type of credit include the need for collateral from some banks. In addition, payment terms are often short and interest rates high.
3. Microcredit :
This modality is driven by the Federal Government, through the National Program of Oriented Productive Microcredit (PNMPO), and intended for companies that cannot offer real guarantees and / or annual revenues of up to R $ 120 thousand.
Although it seems quite advantageous compared to other types of loans, microcredit is offered by few banks and the amount provided is generally very low.
Where to borrow at the lowest rates
Most business loans are made with large banks. However, these institutions fall short of desire due to excessive bureaucracy, careful credit analysis and high interest rates.
Proposing a true revolution in the financial market, fintechs offer new credit opportunities and reduced rates. Through peer-to-peer group loans, these companies unite borrowers and investors.
Good Finance is an innovative digital platform that offers loans at rates up to 60% lower than conventional banks. Operations can be carried out with or without guarantees and the installments fit the budget.