SMS credit: the features, its advantages and disadvantages.

The particular SMS Credit – one of the most unknown form of a small loan? There are the recognized loan types such as sequel loans, online loans, quick loans, instant loans, little loans, loans without credit score bureau and a few more. Forms of loans that are absolutely typical in German finance. After that there are also some types of financial loans that are hardly known to anybody. Which is not because you generally do not exist. Rather, it does not take case that these niche financial loans are only very rarely provided. One of these rather unknown and as rarely offered kinds of credit in Germany may be the so-called SMS credit.

The SMS mortgage as a small loan is really a loan offer which seems quite seldom on the The german language credit market. Thus, having a certain justification, the question comes up, why is that really so? May the SMS loan even so be an useful alternative to the particular classic types of credit? 2 fundamental questions to be clarified.

The TEXT MESSAGE credit has rarity worth

The SMS credit has rarity value

In principle, little loans by SMS are the cause of the ongoing development of cellular communications in today’s society. The particular smartphone has become a barely little element and the tablet offers justified its right to can be found. As a result, pretty much every bank within Germany now has a financial app that makes it easy to perform its online banking dealings from anywhere. In addition , the very first fin-tech companies are implementing natural mobile banks in the monetary world, just to revolutionize precisely those. Only one thing will not really get going anyhow, not really driven by Info-Techs, specifically the mobile loan company. Be it online via currently established app’s like Kapreska or in the form of SMS conversation. Where SMS communication within the mobile world almost noises antiquated again.

And yet it can be stated that will who offers such a text credit certainly secures the interest of the target group searching for such a rather extraordinary method of fast borrowing. After all, this particular offer of “fast money” via SMS is flawlessly matched to the generation mobile phone and mobile phone. Because you may request a desired mortgage quite comfortably by TEXT MESSAGE – locally completely indie (radio network availability of program provided! ). Completely not affected by any service or even opening hours of a conventional financial institution. Means: Virtual profit a few seconds and without having to get into a bank.

Maturities and interest on the loan by SMS

Maturities and interest on a loan by SMS

Anyone interested in a loan through SMS, should be aware that this is really a classic mini loan. Hence, according to the amount of the mortgage, the term of such a small mortgage is also quite short. Which means that, depending on the provider, the pay back terms are between seven days and a maximum of 60 days. This follows that after expiration of the chosen loan time period, the mini loan simply by SMS so in addition to related interest in a sum to become returned to the lender. The particular short maturities have the benefit that, despite significantly increased interest rates on an SMS mortgage, the interest burden is lower in comparison to a classic sequel loan.

The advantages of fast SMS credit

The benefits of fast SMS credit

In the case of SMS credit, the particular communication between the lender as well as the borrower usually takes place totally using the smartphone via TEXT MESSAGE. Starting with the application including the preferred amount to the final settlement. Due to mobile phone number, the lender can easily assign the identity when the applicant is already a customer from the respective institute. This means that we can process the loan application as soon as possible. The loan volume is founded on the amount of a classic small mortgage. Such a small loan hence amounts to around 100 pounds to a maximum of 600 pounds to the known interest rate to get a small loan of the company. Due to the short channels associated with communication between the credit organization and the credit provider, the particular granted microcredit can generally be arranged within an extremely short period of time (30 moments to 4 hours).

The disadvantages of the SMS loan

The disadvantages of an SMS loan

As the case with anything that is simple to do and is, from a very subjective point of view, quite easy to “act”, SMS credit also creates significant dangers. Everything apparently “simple”, is often not given serious attention in its obligations and, in the event of non-content, resulting consequences. It is far from without reason that within the Scandinavian countries, where credit score originates via SMS, this kind of loan is the ultimate financial debt trap. Young people in particular frequently use SMS loans during these countries to get money easily and quickly. This results in a verifiable high and uncontrolled financial debt. After all, a top-selling customer good lures you someplace for a bargain price, that you can buy right away thanks to a comparatively easy SMS loan.

The awareness of accountable borrowing clearly looks various. Because similar to the overindebtedness trend of the disbursement credit a person slip over this way in fact quickly into a debt snare. Consequently, a danger that does not appear to be initially aware of the debtors. What on the one hand represents a benefit on the one hand because of the quick accessibility to an SMS loan may undoubtedly also be regarded as the disadvantage in the same breathing. Because borrowing is quick becoming a habit. Thus, the worry of a loan fades as well as the drama takes its course. Specifically for low earners this way will be dangerous and leads rapidly into a debt trap. The particular quick microcredit as a window of the financial abyss. A good uncontrolled availability of lendable cash definitely harbors its hazards – especially for teenagers!

To counteract this particular, however , the providers associated with small loans in this nation have installed an alleged credit lock. This means that credit must first be paid back before another loan could be taken via SMS.

Provider for an TEXT MESSAGE loan

Provider for an SMS loan

Compared to the Scandinavian countries, where there are a many SMS credit providers, the product range in Germany is more compared to manageable. Traditional banks never even have such a loan provide in their portfolio, nor perform most specialized lending suppliers or brokers. From this understanding, however , a mini-credit supplier may have made the decision to design the corresponding loan offer because SMS credit and take it to the market. This is the multi-award winning mini-cash provider Viloan. Viloan is the only one in this particular niche of the credit marketplace to offer such an SMS mortgage. However , certain conditions apply at the Viloan SMS mortgage, as this loan is only open to so-called existing customers from the company.

Which means that for the first time a classic mini mortgage has to be taken up and paid back on time. Ers then, if required, a second small loan through SMS (as a proven current customer) can be applied for. Additionally , at Viloan generally is applicable that one loan must 1st be paid before one more can be taken. This also is applicable without exception to the TEXT MESSAGE loan. So Viloan really wants to counteract the risk of over-indebtedness simply by untapped loans.


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