Just a few years ago, people who needed a cash injection had to go to a physical branch of a loan institution or a bank. Today, a client in financial need can raise funds in a much faster and more convenient way - by taking out an online loan. The question is, is borrowing money over the Internet completely safe? What rules should be followed to ensure that this is the case?
Loans over the Internet are currently offered by several dozen non-banking companies, which offer the possibility of quick and easy borrowing from several dozen to even several thousand zlotys. Quick and easy, because all the formalities and procedures occurring here, not only are limited to the minimum necessary, but also do not require the customer to leave the house. The whole process of borrowing, i.e. the submission of an application, information on the lender's decision, the provision of the final terms of the loan or even the transfer of funds itself, takes place exclusively via electronic means. Interestingly, it is the simple course of the entire transaction that makes some customers have doubts about the security of the transaction. In addition, they are also afraid that they will fall victim to a dishonest loan company, or that they will be dragged into a product containing many hidden costs.
The Internet is just a channel of communication.
However, most concerns of potential customers are unjustified - or at least not those based on the belief that the Internet is the source of threats. In practice, the Internet is simply one of the channels of communication, which, compared to other channels, simply brings a much greater wealth of possibilities. The network is widely used by individuals, companies and institutions for which it is a convenient way of offering services.
The remote communication channel on which online lending companies rely does not in itself generate much risk. The whole transaction will be safe and secure if the customer takes care to check the institution with which he intends to sign a loan agreement and carefully acquaint himself with the conditions under which it is made available. Below we present the most important issues that need to be taken into account in order to ensure that the use of the online loan does not cause any additional problems.
Taking out a loan online - only in a reliable non-banking company
The activity of non-banking Internet companies is strictly regulated by the law. Like banks, SKOK-i and stationary lending institutions, they are obliged to, among other things, inform about the total actual costs of loans, or make reports and documents required by the Polish Financial Supervision Authority available. Moreover, after the last update of the rules, they can no longer freely determine, for example, the amount of penalty interest for possible delays in the repayment of a loan.
However, while the interests of the clients of lending companies are now well protected by legal regulations, it is essential to check the credibility of the offer of one of these entities before using it. There are dozens, if not more, of such companies on the market, and unfortunately there are some of them that are not fair to borrowers. In practice, it is not difficult to verify a non-banking company - institutions such as the National Register of the Judiciary, the Central Register of Business Activity and Information, the Polish Companies Association or the aforementioned Polish Financial Supervision Authority provide assistance. They maintain and share databases that allow you to find out which loan companies are legal and trustworthy. This information is well complemented by customer feedback, posted on portals and financial forums, or in social media. Of course, it is also worth reviewing the online loan rankings that can be found on many websites - they are the best way to verify the profitability of an offer.
Typical transaction flow
In many non-banking companies, the online borrowing process follows the scheme below:
§ creating an account in the company's website - not in all companies this option is available, however, thanks to registration on the website you can easily control the process of granting and later repayment of a loan;
§ choice of the amount and date of payment of the liability;
§ Fill in the data form and submit the application online;
§ execution of a transfer for 1 gr, 10 gr or 1 zł, which allows you to verify the identity of the customer.
In order to avoid any subsequent problems or misunderstandings, the customer should make sure that the data entered by him/her is correct and that the lender's offer is not accompanied by any agreement to additionally paid services. He should also pay attention to the amount of the verification transfer - if it is significantly higher than these values, the company is most likely not fair and is only trying to defraud money.
Security on the loan company's website
Before a customer fills in any forms on a loan company's website, they should make sure they are encrypted. This is indicated by a green area with a page address or a green padlock. An encrypted website guarantees that no personal data will fall into the wrong hands.
Loan company and GIODO
Personal data of the clients of the lending company are protected by the GIODO, i.e. the General Inspector of Personal Data Protection - but of course only on condition that the institution has reported its data sets to this institution. A potential borrower should therefore verify whether the e-GIODO search engine contains an application of a company that is interested in it. This entry guarantees that the data is processed in accordance with the law and that the company has complied with all the obligations imposed by the law.
What else should you know before you take out an online loan?
In practice, the disappointment of borrowers and their potential disputes with lenders are usually due to the fact that the provisions of the loan agreement and annexes are not read or not read properly. And although it is a fact that some companies construct opaque contracts (by the way, provisions raising serious doubts should induce to give up a given offer), most non-bank institutions are honest with their customers and have a transparent offer. An example is the Wonga company, which provides new customers with the possibility of taking out a loan, the total cost of which is exactly 10 PLN. And importantly, a loan that does not contain any unclear provisions, the non-observance of which could result in additional charges being levied.
It is also worth noting that the loan agreement may be terminated at any time - each borrower may terminate it within 14 days from the date of signing the agreement without any consequences. This means that even a possible too hasty decision to incur a liability in a given company is still "reversible" for quite a long time.