An increasing number of South Africans are struggling to make ends meet. All of us are facing a sluggish economy, interest rate hikes, currency volatility, widespread unemployment, high inflation and rising water and electricity rates.
According to the World Bank, South Africans were the biggest borrowers in the world in 2014 – a reflection on the discrepancy between average income and expenses in SA. What’s more, research by Debt Rescue indicates that on average, only 23% of South Africans have money left at the end of each month.
If you need additional funds to make ends meet, a short-term loan may be a good option for you.
Although short-term loans may appear to be easy loans, many come with high interest rates and hidden fees. In theory, the National Credit Act protects consumers from unscrupulous lenders – but in practice, many desperate South Africans still fall prey to scams and loan offers involving exorbitant costs.
So rather than rushing into a loan agreement, always do your research. Here we outline some of the options for short-term loans in South Africa.
Bank loans definitely don’t qualify as “easy”. Banks have become increasingly stringent with their loan terms and many have laborious loan approval processes, involving a lot of paperwork, time and potential uncertainty.
If you have blemishes in your credit record or are currently unemployed, it’s likely you’ll struggle to secure a short-term bank loan – or the amount that you can borrow may not meet your loan requirements.
A payday loan is a small cash loan, which usually has to be repaid when you receive your next salary payment. These loans are appealing because they involve no credit checks and pay out on the same day.
However, if you are unable to make payment on time, the late fees and interest can accumulate rapidly. Also, payday lenders in South Africa have a notorious reputation for charging wildly exorbitant rates and keeping their clients in perpetual debt.
A short-term asset-based loan is a loan made against the value of one or more of your personal assets, such as a vehicle you own, a luxury watch or valuable jewellery. This is a good option if you need cash fast and have valuable assets that you can use as collateral.
Asset-based loans are usually approved within 24 hours, and no credit checks are involved because the loans are secured through collateral.
At lamna, we offer fast, easy loans against the value of a wide range of assets, from luxury watches and jewellery to vehicles or artwork.
For more information about using an asset to secure a short-term loan, contact us on 086 111 2866 or simply complete and submit our online application form.
Source: Funding Lamma
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