What is an International Private Lender?
An international private lender refers to a loan provider who is either a private person or an investor who provides funding to individuals with operations in two or more countries worldwide.
Despite having no connection with bank institutions, international private lenders for personal loans remain reliable when instant cash is needed for whatever purpose there may be.
International Private Lender in the Philippines
ÆON Credit Service (Philippines) Inc. or (ACS)
The most notable international private lender that opened operations in the Philippines is the ACS. It is a subsidiary of the AFS Corporation Co., Ltd. (AFSC) which is a subsidiary of the ÆON Bank wholly owned by the ÆON Financial Service Co., Ltd. (AFS) in Tokyo.
ACS offers the following financial products: Appliance Loans, Furniture loans, and Personal loans.
To apply for any of their products, the borrower should visit any of the ÆON service branches near them and start the application process. Another option would be to download the ÆON mobile app and start the loan application process from there. The only requirements needed are proof of income, 2 valid IDs, and proof of billing.
Loan Amount: up to ₱50,000
Interest Rate: 2% per month
Loan Term: 6 months to 12 months
Kiva
Kiva was established in San Francisco, USA with a vision to help the unbanked population of the world have access to financing. Currently, over 1.7 billion people are not financially included. It is through this type of crowdfunding that they are reached to empower them to lead better lives.
To borrow, the loan applicant can visit the Kiva website and start the loan application and gain access to a loan with the following terms:
Loan Amount: up to $15,000
Loan Term: up to 36 months
Interest Rate: Kiva does not charge a loan but the private lenders will
Crawfort
Crawfort is originally based in Singapore and aims to become the leading digital microfinance institution in the countries they operate in. They have been operating for the past 9 years with a 98% approval rate for loan applications that only takes 5 minutes to complete.
Loan Amount: ₱1,000 to ₱50,000
Interest Rate: 7% per month
Loan Term: 60 days to 120 days
Types of Private Personal Loans Provided by Private Lenders
Secured Personal Loan
This type of loan is offered by a wide variety of private lenders both locally and across the world. Depending on the applicants’ credit history and credit score, he/she is allowed to borrow cash by pledging with a specific value of an asset or collateral.
Unsecured Personal Loan
Contrary to a secured personal loan, this type of loan no longer requires the use of the applicant’s asset as collateral. Rather, the loan will be merely based on the applicant’s credit rating and credit history.
Advantages & Disadvantages of Applying for Personal Loans from an International Private Lender
Advantages
- Any credit history is often accepted
Unlike other loan providers, private lenders allow applicants to borrow cash regardless of the status of their credit score, provided that the type of loan the borrower is applying for is an unsecured personal loan.
- Easy Application
International private lenders for personal loans usually provide an online application process that helps borrowers easily fill out their loan application form.
- Fast Approval
Private lenders typically approve loan applications within a few minutes or days. However, in such cases where your documents are incomplete, expect that approval would take a bit longer.
- Secured Privacy
International private lenders for personal loans ensure that all personal and confidential data during your application is properly stored and curated in an encrypted form.
Disadvantages
- Short Loan Tenure
Because the application is easy and disbursement is quick, the majority of private lenders expect that borrowers will be able to repay their loans within a short period of time.
- High-Interest Rates
Private lenders usually add high-interest rates on top of the loan amount that the borrower requested. This is because private lenders, especially international ones, obtain their funds from different sources such as private entities and/or stakeholders which also ask for high-interest rates. These rates can then be reflected on the interest rates associated with the loan in order to ensure that the private lender will manage to secure their funds from their investors.
- Potential Loss of Collaterals
Secured personal loans require borrowers to put personal assets as their collateral to guarantee that the loan will be paid on time. This implies that there is a chance for international private lenders to take these assets (i.e. car, property, jewelry), should the borrowers fail to repay their loans.
- Exposure to Possible Fraud
Not all private lenders are legitimate. There are those who pretend to be private lenders but their goal is to swindle and scam just to get any valuable thing from the borrower.
Conclusion
International private lenders for personal loans open many doors of opportunity to help people across the world, including Filipinos, finance their basic needs. These lenders hold a fair share of advantages and disadvantages for applicants but it cannot be denied that they are beneficial in various ways. Consumers must be well-educated about the pros and cons before committing to a loan, especially if it has a high interest rate.