At present, the distinction between bank and non-bank loans is blurring in a number of respects, particularly as regards the way in which a contract is concluded.
Nevertheless, they differ in several essential parameters. The offer is very wide thanks to several thousands of providers and the comparison of individual offers can be found for example on specialized credit comparators.
Non-bank loans can be taken for a very short period of weeks, while bank loans usually have a repayment period of at least several months or even years. The amounts provided also vary, starting at 10,000 at banking institutions, with only one bank offering a loan of USD 5,000.
What are the other differences?
Another difference is the account from which the loan is repaid. If you are taking out a loan from a bank other than your current account, be prepared to set up another account. Banks tend to top out the number of clients. On the other hand, non-banking institutions do not care what account they will receive payments from.
With non-bank providers, you can sometimes get a short-term loan for free, but banks aren’t charities, so you will have to pay for the loan sooner or later, even though the interest rates and APRC on bank loans are currently very low. All banks also check the credit history in the Bank and Non-Bank Client Information Registers and in the register for all applicants.
Can both be obtain online?
Some banks also require an online branch to visit a branch or sign the original loan agreement and send it by post along with the required copies of the documents. The number of documents and confirmations required varies depending on how long the applicant has been a client of the bank, how he has repaid his obligations in the past, and how much money he regularly pays to his account.
Non-bank loans usually do not require as much administration and screening and are easier to obtain. However, sometimes banks are inspired by banks for individual non-bank credit products, so always enter your loan parameters and compare bids regardless of whether it is a bank or non-bank product.