When money starts running short for everyday expenses, bills remain unpaid, family turns away, and a bank refuses to grant a loan, non-bank lenders come to the rescue, offering instant loans without a credit check in BIK and without collateral.
According to the Office of Competition and Consumer Protection (UOKiK), non-bank lenders are all companies that provide consumer loans and cannot be classified as either banks or Cooperative Savings and Credit Unions. The latest UOKiK research identified 72 financial companies operating under the Act on the Freedom of Economic Activity and granting loans from their own funds, although it noted that there are certainly many more. The best-known companies on the Polish market include Zaimo, Provident S.A., Kredito24.pl (https://www.kredito24.pl/), Wonga.com and Vivus.pl.
Non-bank lenders look for customers among people who have no chance of obtaining a loan from banks because of debt or insufficient creditworthiness. It is worth emphasizing that most such financial institutions offer so-called “payday loans” or “weekly loans.” The former are taken out for approximately 30 days, while the latter run for 6–12 months but are repaid every week. The value of these loans is generally low, ranging from PLN 100 to PLN 3,000. Loans for higher amounts and longer terms are granted only occasionally, owing to the risk associated with failure to repay such an obligation. In addition, for larger amounts, the fees accompanying the loan, as well as the interest rate itself, quickly rise.
And the costs are not low to begin with. Unlike banks, non-bank lenders lend their own money, which involves a greater risk of losing it. That is why most of these institutions rely in their offers not only on inflated interest rates but also charge high fees for other services, such as home loan repayment, payment reminders and notices. Given the risk of such a loan, higher interest rates can still be understood. However, additional, often hidden costs should not be allowed.
A reputable lending company should derive its profits mainly from interest. If, on the other hand, most of its revenue comes from penalties and fees, this means that it has a negative attitude toward its customers and does not care about their well-being. Such practices are precisely what most often lead customers into debt.
(iza)