The necessity of satisfying an urgent need, with the lack of enough cash, “makes” people dizzy. After all, we are rarely prepared for unexpected expenses. Especially when they are costs of several thousand zlotys. Therefore, thinking in perspective, give up your account balance and focus on a more convenient solution, which is a payday loan.

kredyt odnawialny grafika 300x233 Payday loan – and everything “from scratch”

A payday loan is one of the services offered by the bank “just like that” just in case. Life brings with it many unexpected situations – from minor and prosaic financial stumbling, to “getting caught up” in a spiral of debt. Read also: How to get out of the debt spiral? Here are 6 secrets!   Therefore, a payday loan is a product available to every holder of a standard savings and settlement account, ie a popular ROR.

Often, we can meet with his other names: credit line or credit in the account , which means the same, and so – additional cash, for which the account owner’s balance is increased.

A good solution in an emergency

How does it work and what is a renewable loan? Well, it is a permanently available credit line that the account owner can use for any purpose. What’s more, additional funds are always at hand and can be assisted if necessary. However, in order for this to happen – the bank submits a prospective credit analysis to the potential borrower. It takes into account the factors that constitute the main source of security. These are:

  • Monthly amount sent to a bank account
  • Conditions for income financing: their amount, quality and frequency

A renewable loan is usually granted for 12 months and is automatically extended until it is terminated!   Interestingly, the entire amount obtained under the loan together with accrued interest on the funds used, “returns” to the bank only after the loan period has expired. By deciding on this type of service – the purpose for which the funds will be used is not important. For example, if your account receives monthly revenue of 3 thousand. PLN, and the payday loan amounts to PLN 6,000 The borrower has at his disposal up to 9,000 zł!

kredyt odnawialny 300x200 Who can apply for a payday loan?

In this case, the terms of granting depend on each of the banks. Nevertheless, there are several key criteria that every potential borrower must meet. A renewable loan can be applied for:

Individual customers who:

  • have Polish citizenship and live in Poland – but also foreigners employed in Poland or receiving a Polish pension, retirement or scholarship,
  • they regularly fund their account with income from pay, pension or disability and have a bank account for at least 3 months,
  • they are distinguished by positive creditworthiness, without a debit balance for 3 months before submitting the application.

Although initially payday loans were dedicated to private customers or joint accounts – over time, more and more banks make available in their offer and this type of lending for companies that:

  • They have temporary financial problems and have to top up the budget with a small sum of the credit line,
  • They must meet the same criteria as natural persons – including having a positive credit rating

How much does a payday loan cost?

You need to know that this type of loan renews every time you pay off your debt. How? When additional funds appear on your account, most banks automatically collect the amount they have drawn – so that the credit limit is made available again. And so all year!

What is the cost of a payday loan? Each bank offers different credit terms, which, firstly, depend on the customer’s creditworthiness and, secondly, the amount for which the credit line is to be activated. However, the loan will definitely be added:

  • Interest – charged only for the period in which the borrower used the money. No additional costs are charged for the possibility of borrowing cash!
  • Commission – for opening a credit line. Sometimes it is collected from the client’s own funds and not within the limit granted. This is the case when the incomes on the account are irregular and significantly different from those specified in the contract, or when the borrower has exceeded the allowed limit.
  • Fees related to the establishment of additional collateral – e.g. bill of exchange

As you can see – a payday loan is in fact a much more cost-effective and cheaper solution, because the next payment of incomes on the account automatically reduces the sum of available credit from which interest is collected.

kredyt odnawialny grafika2 300x201 Example of a credit line

You have 2,500,000 on your bank account PLN free funds and 5,000 PLN of granted payday loan. If you want to make the necessary purchase, you can withdraw 7,500 thousand. PLN – so you use the available credit line. At the moment, the balance is 5,000. zł.

From 5,000 paid PLN, the bank starts charging interest. However, after a few days, the account received a remuneration of PLN 3 thousand. zł. And from this amount, the lender begins to charge interest.

In summary, each subsequent payment to the account definitely reduces the cost of maintaining the loan. Ba – if the credit line is not used – the bank will not take a zloty for it.

A payday loan is not a debit!

Most people, a payday loan is wrongly associated with debit. There are, however, two different financial products. Their main difference is formalities. In order to benefit from a payday loan, you must first apply and sign a contract with the bank. In the case of debit, such activities are not needed. Another disagreement is also the amount of credited support. In a renewable loan, it ranges from PLN 500 to even PLN 150,000. zł. However, in the debit, these sums are definitely lower. It is worth remembering that, just like every loan and at a payday loan, the banking institutions examine the creditworthiness rating and the amount and regularity of monthly payments to a bank account.

An alternative to credit card and cash loans!

Lending needs and expectations with the help of this option is actually a flexible form of financing. Because even a single “jump under the dash” does not oblige you to apply for an additional loan or credit. What else belongs to the advantages of a payday loan?

  • The Bank only charges interest for the amount of credit used ,
  • A customer using a credit line may withdraw funds from an ATM directly from a personal account , order transactions and non-cash transfers,
  • The funds from the credit line can be used for any purpose, without any restrictions on the part of the bank
  • No need to repay the debt in installments – each additional cash effect on the account reduces the total amount of money borrowed kredyt odnawialny grafika3 300x169
  • A good way to gather financial reserves – you can always get them when you need them

Of course, every benefit should be used within reason. After all, it’s very easy to lose yourself in finances and stop distinguishing between your own assets and money borrowed from the bank. A reasonable disposal of savings is always included! Therefore, it is worth treating a payday loan as a “security cushion” – in the event of unexpected expenses and look carefully at the offer that suits individual needs and expectations.