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FAQs About Guarantor Loans

Have you ever heard of guarantor loans? Many people will say yes, but many of them are not familiar with how they work. Some cannot even explain what guarantor loans are. If you are planning to get such a loan, you must have the right information about the same. This article will discuss some of the frequently asked questions about guarantor loans. Read on.

How Does Guarantor Loans Work?

loans, guarantor loansThese loans are similar to unsecured loans because the borrower does not need to own a car, a piece of land or home because no collateral is needed. The borrower should get another person who will act as a guarantor for them. This happens because the borrower has a poor credit history or no credit history at all. The guarantor signs to pay the loan in case the borrower does not meet the agreed monthly repayments.

Who Is Eligible to Be a Guarantor?

Many people use a family member or a close friend. The only restriction is that you are not supposed to be sharing any credit items like bank accounts or credit cards with the person. The guarantor should have a good credit history as well. He or she must be a homeowner or anything else which acts as collateral.

What Does the Guarantor Do?

The guarantor’s job is to supply a credit score to enable the borrower to get guarantor loans. They will be required to sign some papers and make sure that they understand all the terms. Some lenders will ask for their pay slips and bank statements. The extreme requirement which rarely happens is that they will be held fully liable to pay the loan if the borrower fails to make payments as agreed.

How Fast Can I Get the Money?

guarantor loansThis depends on the lender, but normally, after the receipt of all the documents required, the lender starts the processing and releases the funds. This should take no more than seven working days. After the decision is made to release the loan, the lender enters all the documents required and sends money to the borrower in the form of a cheque. As mentioned earlier, the whole process should not take more than seven business days.

Any Prepayments Needed?

There are no fees required for these kinds of loans. Be sure to have made the right evaluations of your finances to be in a position to repay the loan.…

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Financial Inclusion: A Way to Grow the Economy

Whether running a home, company or a country, a healthy financial life is key as it plays a big part in growth and development. But challenges do come and shake the economy at one point or the other. Financial inclusion is one of the ways to bring prosperity in the current world. Which economy wouldn’t love to include some fine things that would bring growth, sustainability and progress? Here are some of the financial inclusion pillars every economy should think about

Financial knowledge and access

Finance informationThe fundamental way to develop an economy is first to educate people about the finances and then give them access to the financial opportunities and institutions. With a more people becoming financially literate, it will be easy for them to use the available financial avenues in their country.

This would result in greater returns as people exercise their financial knowledge to their benefit, which would benefit the country too. A country should consider educating their youth more so that they can make sustainable financial decisions which will affect the future of the country. This too will pass the knowledge better.

Mobile banking

The world has moved into the use of smartphones. The evolution of the smartphones has made the banking systems reach more people than they used to. Phones have made transactions easier. They have also made access to cash in remote regions easier.

Some companies have created opportunities to transfer cash in great worldwide networks. Having this in an economy creates a great impact on the financial standing of a country. With more money finding an easier medium for transfer, more revenues are generated in turn.

Microfinancing

This has an incredible effect on financial inclusion. Monetary financial institutions, MFI, are preferable to the old bank loan systems. The reason behind is that they issue more affordable financing. Whether it’s an individual business, a small or medium-sized enterprise, they can all benefit from the loans from an MFI.

Though some challenges are seen with the MFI, such as high transaction rates while some collect back their cash in a harsh manner, if done well they are a sure way to drive an economy forward. The advantage is that they significantly ease the financial needs of small entrepreneurs.

Consumer security

Financial securityFinancial literacy is a challenge to many individuals, especially in the developing world. This creates the need for the government to protect its individuals from the corrupt in the society. These are people whose aim, is to bring down development through violation of privacy and fraud. The right infrastructure and systems should be put in place to curb such violations. This will help the individual develop confidence and continually use financial services. It will grow the economy significantly.

Finally

Financial inclusion is a sure way to reach the challenged in any economy. Any country which decides to bring on board the challenged to utilize the available financial vehicles has made a step in the right direction. These are the people who will set solid the economy in the future and improve the country’s GDP. Why not include them?…