Search Results for: business loans

So, you’ve come up with a company concept that you want to put into action. You do, however, require funds. So, what exactly do you do? Business loans in South Africa are available to mitigate the financial burden on sole proprietors.

In South Africa, business loans can be used to fund both new and established firms. This form of loan, which is available from a variety of lenders ranging from banks to specialized lending businesses, may appear to be a quick and straightforward option to receive enough funding to launch your business. But don’t forget to do your homework.

Start your business loan application

To begin with, how do you even apply for a business loan in South Africa?

It can be challenging to go through the process of applying for a loan, much less getting approved for one. In many cases, businesses are desperate for help and instead of waiting for loan approval, they take the risk of going to a fast lender. 

It is likely that you will have to go through a lengthy application process if you get a loan through a reputable lender. Lenders want to ensure that you’re who you say you are and will not be a liability, which is why they often require different documents and verification. Even though you might really need the money, rather go through a company you’ve read a lot about, on Platforms like loanspot.ng. 

What type of business loans are usually available?

If you’re getting a loan from a bank or another lender, the kind of loan you’ll get will depend on the lender. Among the types of loans that you might apply for are:

1. Bank finance such as an overdraft (added to your business account when you are able to provide a business plan and some sort of asset)
2. Debtor finance (ideal for growing businesses that meet a specified turnover) 
3. Asset finance (puts the loan against assets such as equipment and vehicles) 

You could also consider asset funding from a loan specialist, using assets to secure your loan. Some lenders also offer unsecured loans that use interest rates instead of assets.

Who can apply for a small business loan? 

The Small Business Administration offers loans for people who are starting or operating small businesses. Wikipedia defines a small business as:

“An SME in South Africa is any enterprise with one or more of the following characteristics: Fewer than 200 employees. Annual turnover of less than R64 million. Capital assets of less than R10 million.”

Along with meeting the above requirements, your business must also have been operating long enough to demonstrate a track record of success. Furthermore, you will need to prepare a detailed business plan that outlines your:

1. Financial projections. 
2. Clear record of your income and expenses (and how much you’ll need as a salary).
3. Your start-up costs
4. Running costs for the first five years
5. Any other requirements requested by the lender

Where can you get a business loan? 

Now that you’re ready to start looking for a business loan, where do you go to find the best loan with the best payment terms, interest and customer service?

Banks

South Africa’s major banks like standard bank all offer loans for businesses of all sizes. You could speak to your bank first to determine what they can offer, or you could do some research to find the bank with the best overall rating.

You can easily find out how banks are rated by using a tool such as Loanspot, which displays consumer reviews. Our banking category lists all major banks in South Africa, giving a rating for the overall bank, as well as a rating for the trustworthiness of the bank. 

Asset finance houses

Lenders like these are usually part of large banking groups. As an example, Bankfin is part of Absa, Stannic is part of Standard Bank, and Wesbank is part of FNB. 

Lenders like these are often a lot more flexible than banks, making it easier to get a loan. The loans they provide are usually smaller. 

Specialised lenders

Furthermore, we have small business lenders who specialize in lending to small businesses. These lenders include direct lenders who lend directly to businesses. Those who don’t qualify for a bank loan might apply to this type of lender, such as an online lender. 

Some of these lenders provide loans to people regardless of their credit history or risk rating. The interest rates they charge tend to be much higher.

It’s loan time 

Starting a new business is an exciting experience. It’s also thrilling to watch your company expand. Obtaining funds for your company can open doors, allowing you to acquire equipment, invest in your first office or factory, recruit additional people, and fulfill your objectives. You will discover that company financing is a lot less stressful if you take the time to plan and prepare.

Conclusion

Platforms like Loanspot and Google assist you in gathering all of the information you want to make informed judgments based on facts rather than speculations. Your company is significant enough to demand cautious consideration. If you approach business loans with caution, you’ll be able to secure the funding you need to expand your firm.

It is one thing to have a viable venture, but quite another to receive the funding needed to get started or continue on. Unfortunately, generating funds to pursue their dreams is one of the challenges facing some emerging entrepreneurs. The good news is, start up business loans in South Africa are available to ease the financial burden of business owners within the country.

Thus, in this article, we explore some funding options for small businesses you can consider for your dream venture. Additionally, we will discuss how to obtain loans for your business so that you may eventually contribute to the reduction of unemployment rates in your country.

Funding for a small business startup 

The success of any enterprise is dependent on adequate funding. It doesn’t matter whether the enterprise is small, medium, or large, having enough money to start or run it is essential. Thus, having a viable business idea will never be enough to start a business. Personal loans can also be channeled towards business growth.

Although you may not necessarily be the sole financier of your business, one of the requisites of being a proactive entrepreneur is that you can raise the required funding for it. New startups have a number of funding opportunities available to them, making things easier. Entrepreneurs can, for instance, meet with small business funding agencies or apply for government grants. 

How do I get a loan to start a business in South Africa

Accessing capital for your business can be accomplished through different channels. Listed below are five options that you can explore.

Fincheck

1. Fincheck is a provider of a live and independent way of comparing and applying for finance from more than 30 South African banks, lenders, and insurers.
2. Who they serve: Business owners seeking finance in South Africa.
3. Amount: R20,000 – R72 million

Lulalend

1. They offer instant funding decisions on applications based on proprietary scoring technology.
2. The company serves South African businesses from all industries with annual revenue of over R500,000.
3. In the range of R20,000 to R1 million

Fundrr

1.  The company developed an automated credit model that analyzes close to 100 data points in order to provide a complete picture of growth opportunities. This produces a Fundrr score.
2. Who they serve: At least a 12-month track record, with a minimum of R1 million turnover or asset value.
3. Amount: R20,000 – R500,000.

Merchant Capital

1. Provides flexible repayment terms for merchant cash advances to retail businesses.
2. Typical client: Retail business owner with an average of over R30,000 in credit and debit card sales and has been in business for at least one year.
3. Qualification: Up to 100% of a business’s average monthly credit and debit card turnover.

Bright on Capital

1. They provide affordable working capital financing to emerging small supplier businesses with sustainable growth prospects through their peer-to-peer lending platform.
2. They cater to small businesses that are at least 12 months old, who supply organizations or government entities with creditworthiness, and who expect to generate R1 million or more in annual revenue.
3. To execute on procurement opportunities sourced from these qualifying large entities, small businesses can access revolving working capital facilities of up to R1 million.

Other sources of start up business loans in South Africa

1. Bank finance

Banks give business loans to businesses, although it could take some of them months to complete their processes. They will also require collateral for the business loan.

2. Government grant

The government grant is interest-free, and you don’t need to pay back the grant. Not all businesses get the government grant, this is because of their strict selection criteria. The government monitors how businesses spend the grant.

3. Venturing Capital (VC)

Venturing capital organizations invest in businesses, by so doing such businesses have the immediate cash flow to get things done. Venture capital organizations invest money in businesses in return for shares.

Most times, early-stage businesses that will sacrifice equity and control go for venture capital finance. This is because the venture capital organization would want to partake in running the business from the board level.

4. Peer to peer (P2P) lending

In this source of a business loan in South Africa, there is usually no need for any financial institution. This new form of funding just involves people who need money and other people who need to lend money. Here, some firms prefer to get funds from their peers than from any business financing company of any form.

5. Factoring

Factoring is a way of diversifying your business funding portfolio. They use this form of financing all over the world because it gives businesses finance that grows with turnover. Factoring gives businesses working capital against their outstanding invoices. The factoring company would purchase your account receivables and cater to your debtors’ ledger when you partner with them.

Many businesses choose to factor over bank loans and overdrafts because:

1. You wouldn’t give up equity or control
2. Customers’ creditworthiness is in focus, not your own creditworthiness
3. Finance grows with turnover

How long will I wait for a Business loan

In South Africa, business loans are not granted quickly by lenders. Generally, you can expect to wait for up to two months for your application to be processed. If you are approved, you will receive the funds within another month or within the agreed-upon time frame.

Consequently, the time it takes for a business owner to obtain a loan can be up to three months, which may make it difficult for them to implement their plans. Many quick loans are available, but they won’t offer large sums of money and must be repaid quickly.

Conclusion

Businesses in South Africa usually face uphill tasks from time to time. And these tasks most times require an enormous amount of money to get things done. However, a business loan is always an option they could explore to avoid a breakdown of workflow in their business. Early-stage businesses would really need a business loan to gain aground in the competitive market. The business loans offer finance and cash flows for businesses that need them.

Business loans in South Africa offer a way to finance both new and existing businesses. Obtainable through several lenders, including banks and specialized loan companies, this type of loan may seem like a convenient way to start your business.  In reality, getting a loan can be difficult, let alone getting approved for one.

What is a business loan?

A business loan is the type of financing you can get to meet the urgent needs of your business. Some of these needs could be; to expand your existing business, to buy machinery, to boost production, etc.

How can I qualify for a business loan in South Africa?

First, you must understand how you can qualify for a business loan before getting it. There are many types of loans, and there are also varieties of ways you can get these loans.

In South Africa, getting a business loan could be very easy for you once you prepare appropriately for it.There could be differences in what could qualify you for a business loan across all financial institutions in South Africa.

For business loans, you must meet the following requirements:

1. You should have a very good credit score, at least from 650 and above
2. Prepare your financial statements and management accounts
3. Have a business plans
4. Your financial statements
5. Provide your tax records
6. Your financial forecasts
7. Provide a collateral

How do business loan types work in South Africa?

The simplest way to understand how business loans work is to answer based on the type of loan you’re taking out. Despite the fact that business loans are constantly changing along with the industries they comprise, we’ll attempt to provide a comprehensive answer to the question, “How do business loans work in South Africa?”By looking at different types of business loans available in South Africa.

South Africa offers the following types of business loans:

1. Debtors factoring and invoice discounting

A debtor finance is a type of financing in which a financial institution purchases or lends funds against a company’s debtor book. Basically, a “debtors book” is just a collection of all your receivable invoices.  Factoring, invoice financing, and invoice discounting are other names. 

Businesses can use it as a tool to improve their cash flow and grow their businesses by unlocking value within their businesses. By factoring debtors, a business can offer longer payment terms to its corporate customers, allowing it to take on more or larger projects. 

Alternatively, a business can use debtors factoring to overcome cash flow issues if they are struggling to stay afloat while they wait for their customers to pay.                                                                                    

2. Traditional short-term business loans

Businesses in South Africa are offered a wide range of loans by the country’s major banks. Banking institutions can provide short- and long-term loans as well as specialized loans for equipment and vehicles. However, applying for a business loan through a bank can take a long time – about two months on average. 

If you are wondering if you can apply online for short term loans through your bank’s website, the answer is probably no. An application to a bank generally involves a lengthy and rigorous application process. An application must be filled out and submitted with supporting documentation and information. The majority of banks have requirements for business plans, tax records, and even financial forecasts.

Once you have submitted all your documentation, the process has just begun. In most cases, you will have to wait around two months before finding out whether your application has been approved.

In the event that your application is successful, you will have to wait for a further period of time before you receive your funding. Business owners who need a short-term loan to solve an immediate cash flow problem will find this situation unacceptable.

3. Bank overdrafts

Overdrafts allow business bank accounts to go negative up to an approved limit. Business overdraft limits are generally lower than those of other types of financing. Some banks will impose two kinds of overdraft limits: a lower “soft” overdraft limit as well as a higher “hard” overdraft limit. The soft limit can be exceeded, but you will be charged additional interest rates or incur additional charges. Hard limits on the other hand can never be exceeded.

A long track record of trading is required to qualify for a bank overdraft. An overdraft is usually granted only after you have had a history of trading for at least two years. Unlike bank loans, bank overdrafts generally do not have a fixed repayment date, and interest only must be paid every month. 

You’ll also have to pay account fees or facility fees just to keep the overdraft open, even if you don’t use it. It is important to consider the additional charges that may not be included in the advertised interest rate. Absa overdraft can be a great option for this type of credit.

4. Business lines of credit

A business line of credit is a flexible form of small business loan. This kind of flexibility is not available with a regular business loan. There is a limit to how much you can borrow with a business line of credit in South Africa. Then pay interest that applies to the certain amount you borrow. After that, you repay the funds according to your wishes and never exceed your credit limit. 

The credit line of a business is subject to credit review and is renewable annually. Additionally, you can borrow funds as much as your lender permits. The payment is revolving, just like a credit card.

5. Merchant cash advance

This is a new type of lending available in South Africa for retail and restaurant businesses. Those who accept credit card payments from customers. The amount of the loan is calculated based on the average monthly turnover of the business. Repayment periods range between six and twelve months. 

The repayments can, however, vary depending on the business’ monthly credit card sales. Therefore, if a business has a good month, it repays a bit more than normal, whereas during quieter months, it pays less. Daily repayments make it difficult to keep track of and manage repaid amounts and outstanding balances. 

6. Business credit cards

Consumer credit cards work similarly to business credit cards. However, the chances of approval are low. Compared to other types of business financing, credit card limits are typically the lowest. Additionally, business credit cards offer great benefits and rewards. As an example, the FNB ebucks loyalty program offers businesses points every time they shop at select stores and fuel stations

A business’s performance and credit score are critical factors in determining how much credit your business will be approved for. Credit cards are also a good way to build your business credit score and ability to get other types of financing.

What credit score is needed for a business loan

There is no universal requirement for minimum credit scores for business loans. Additionally, some loans do not require a credit check. In most cases, however, lenders are going to consider your credit score when deciding whether to work with you or not.

Simply put, the higher your personal credit score, the easier it will be to get a business loan. Moreover, your credit score determines not only whether you qualify for a given business loan but also the terms that your loan will have, including the loan amount, the APR, and the repayment schedule.

What are the sources of business loans in South Africa?

1. Bank finance

Banks give business loans to businesses, although it could take some of them months to complete their processes. They will also require collaterals for the business loan.

2. Government grant

The government grant is interest-free, and you don’t need to pay back the grant. Not all businesses get the government grant, this is because of their strict selection criteria. The government monitors how businesses spend the grant.

3. Venturing Capital (VC)

Venturing capital organisations invest in businesses, by so doing such businesses have immediate cash flow to get things done. Venture capital organisations invest money in businesses in return for shares.

Most times, early stage businesses who will sacrifice equity and control go for venture capital finance. This is because the venture capital organisation would want to partake in running the business from the board level.

4. Peer to peer (P2P) lending

In this source of a business loan in South Africa, there is usually no need for any financial institution. This new form of funding just involves people who need money and other people who need to lend money. Here, some firms prefer to get funds from their peers than from any business financing company of any form.

5. Factoring

Factoring is a way of diversifying your business funding portfolio. They use this form of financing all over the world because it gives businesses finance that grows with turnover. Factoring gives businesses working capital against their outstanding invoices. The factoring company would purchase your account receivables and cater for your debtors’ ledger when you partner with them.

Many businesses choose factoring over bank loans and overdrafts because:

1. You wouldn’t give up equity or control
2. Customers’ creditworthiness is in focus not your own creditworthiness
3. Finance grows with turnover

How long will I wait for a Business loan?

In South Africa, business loans are not granted quickly by lenders. Generally, you can expect to wait for up to two months for your application to be processed. If you are approved, you will receive the funds within another month or within the agreed-upon time frame.

Consequently, the time it takes for a business owner to obtain a loan can be up to three months, which may make it difficult for them to implement their plans. Many quick loans are available, but they won’t offer large sums of money and must be repaid quickly.

Conclusion

Businesses in South Africa usually face uphill tasks from time to time. And these tasks most times require an enormous amount of money to get things done. However, a business loan is always an option they could explore to avoid a breakdown of workflow in their business. Early stage businesses would really need a business loan to gain a ground in the competitive market. The business loans offer finance and cash flows for businesses who need them.

Car Loans In South Africa; All You Need To Know

Finally getting a car in your name can be exciting and a little tasking, especially if it happens to be your first. Car loans in South Africa are available to ease the financial involvement in the process. With all the moving parts that come with a car loan, figuring out how to pay for your ride can send you for a spin

Throughout this article, we will be looking at how a car loan works and the most efficient companies that offer it. Read tight. 

What is a Car loan

The term car loan refers to loans that you obtain from a bank, a dealer or a specific vehicle finance company. Car loans or vehicle financing are designed for people who are unable or unwilling to take on the massive initial expenditure of a car. This allows individuals and families to have a set of wheels that meets their needs or even fulfills their driving dreams!

How does Car loans work

A car loan is used to cover the full cost of the car you want. As soon as that is done, you start repaying the loan in monthly installments. Additional fees, including those for administration and initiation, as well as interest, will also have to be paid.

Depending on the lender you choose, the total cost of a car loan varies. However, the most important thing you should know about secured car loans is that you can lose the car if you don’t pay back the loan according to what you agreed.

What are the interest terms for car loans?

In South Africa, the maximum interest rate on car loans is 27.5%. When you get a car loan from a bank or other financial institution, you also have to pay interest. Interest payments enable lenders to make a profit from giving out loans. There are two types of interests rates involved with secured car loans: 

1. Variable interest rate

In this scenario, the interest rate you pay on the loan could go up and down as you repay it. A change in interest rates is caused in this case by South African Reserve Bank activities, which control the prime market rate directly. Variable interest rates can offer you very low rates, but they are not guaranteed since the rate can rise at any time.

2. Fixed interest rate 

Fixed interest rates mean that your interest payments will remain the same until you have finished repaying the loan. It is not affected by the prime market rate, and you always know how much you’re supposed to pay. However, if the interest goes down because of the prime market rate, you’ll not be able to benefit from it.

Types of car loans available

1. Secured vehicle finance 

This form of credit uses the car you’re purchasing as security. This means, you get lower interest rates because of the lower risk to the lender created by the higher resale value of the car. If you default in repayment of the car loan, the lender will simply repossess the vehicle.

2. Unsecured vehicle finance 

This type of loan allows prospective applicants to obtain a loan without security or collateral. This is a more flexible option since you will not be required to buy a car that meets certain conditions. However, since the lender cannot repossess the car if you default, the amount borrowed comes with higher interest rates and stricter requirements.

3. Car lease 

The lender will lease a car to you, and you get to use it over a certain period of time while paying “rent”. At the end of the agreement, you can either buy the car at a lower price or return the car.

4. Operating lease 

Similar to a car lease, however, a company or commercial organization takes out the lease and makes the repayments.

5. Car hire purchase 

Here you reduce the balance owed on your car by making fixed monthly repayments over an agreed period. Usually, a deposit is required, and you will own the car at the end of the lease agreement. In commercial hire purchase, the credit is used to finance a business vehicle.

How do I qualify for car finance in South Africa

To qualify for a car loan in South Africa, you must be;

1. Be 18 years old or older.
2. Prospective applicants must be a permanently employed salaried individual, earning a minimum salary of R6500 pm.
3. Have a valid South African drivers licence with no endorsements.
4. Be a South African citizen or permanent resident; and.
5. Have a good credit history. 

In conjunction with the aforementioned pre-requisite, the following documents are also needed during application process; 

1. A South African ID;
2. Proof of income (bank statements or payslips) that is not older than 3 months;
3. Proof of address;
4. A copy your driver’s license showing the front and the back;
5. A  minimum monthly income/salary. This varies between lenders, but typically you have to be earning at least R5000; and

If you are eligible for a car loan, you can apply online or at your lender’s office. Additionally, most lenders have websites with additional information about how to apply for secured car loans.

How to Apply for a Car loan in South Africa

The application process can be either tedious or smooth and easy, depending on the financier you eventually decide to go with. Generally, the process includes; 

1. Filling out an online application of a financier
2. The online application will have to go through a pre-approval process
3. The seller will then need to accept your online application and perform the necessary technical inspections of the vehicle
4. You will provide the necessary documents
5. You will then enter into a buyer and seller agreement where you sign a sales agreement or contract
6. The financier will complete any remaining steps with you and will pay the seller the amount
7. You will then need to do the necessary vehicle licensing and registration (if a dealer does not do it for you)
8. You now pay back the financier according to the financing agreement

How much money can you get when you apply for a car loan

• Minimum amount: Generally, the lowest amount you can get is R10 000.
• Maximum amount: Vehicle finance loans can offer as much as R300 000.

Which bank is best for car loans in South Africa

Not all credit providers are reputable and offer car loans in South Africa. Below is an insight on a few efficient car loan providers in South Africa;

1. Standard bank

Standard bank is a deeply rooted financial service provider. A Car loan from standard bank can provide you with a range of flexible options to help you make your next big move. Whether you plan on buying a brand new car or a used one.  Their differentiator is their long term efficiency and commitment to Africa growth.

2. Ned bank

Ned bank is one of South Africa’s four largest banks. Irrespective of the price of your dream car, Ned bank is available to assist you and help you take each step in your auto acquisition with confidence. Ultimately, they are focused on ensuring you get the satisfaction you deserve.

3. Ford credit

Ford is one of Southern Africa’s leading automotive companies. Now, imagine getting a credit service from the auto manufacturer itself. Ford finance offers a wide range of credit options with a target of enabling South Africans to own the car of their dreams.

4. Cars.co.za

Another wonderful option of car credit providers. Cars.co.za is a young, tech company which represents a significant portion of motoring related traffic in South Africa. They offer financially worthy prospective car owners the opportunity to take ownership of cars while paying for it installmentally.

5. Hippo finance

Another great option for prospective car owners who barely have enough money to confidently finance an auto purchase. Hippo finance is available to help you find finance options, tailored towards your needs and budget. You don’t need to worry about anything during the process, as they design their services to take on the processes on your behalf.

How to choose the best secured car loan in South Africa

With so many secured car loans to choose from, it may be confusing trying to decide which one is right for you. To make it easy, you should consider the following factors before applying for the loan:

1. Interest rates 

Interest rates that are lower make paying back loans more affordable.

2. Other fees 

 Many fees come with loans. For example, there can be a service fee and an initiation fee. Find out which fees come with every loan because hidden fees can end up costing you.

3. The loan amount

Pick a loan that allows you to borrow as much as you need. At the same time, choose a loan amount that you can afford to repay. This is especially important since you can lose your car if you fail to pay back the loan.

4. The loan term 

How long do you have to pay back the car loan? Lenders usually give you up to 7 years. Choosing a longer-term loan means you will pay smaller monthly repayments, but you will also pay higher interest rates. On the other hand, a short loan term charges less interest, but you pay more in monthly instalments.

5. Requirements and other benefits

There are some loans that offer bonuses and have better lending policies. Additionally, it is easier to apply for a loan that doesn’t have strict requirements or complicated application procedures.

Conclusions 

Getting a car loan can be a great option especially when you don’t have enough money to instantly complete the purchase. Car loans give you that flexibility and breathing space you need during and after acquisition. Imagine buying a car in your name and paying for it on an installment basis. You get to own and use the car as you pay the price amount in the most convenient means possible. Just awesome.

Low credit score loans are specifically designed for South Africans with poor credit histories, but they tend to be more expensive than traditional personal loans. It is possible to get a loan even if you have been blacklisted, as long as you can prove to the lender that you can afford the repayments or that you have some form of collateral available.

We have expert advice and tips you can use to improve your chances of getting a loan.

What does it mean to have a low credit score?

When you have a low credit score, it simply means that the financial organization thinks you are a potential risk to the service they provide. We also know people with a low credit score as ‘blacklisted’. It is important to note that the term blacklisted can be a misleading choice of words, as there is no so-called official ‘blacklist’. In South Africa, they label people as blacklisted because of failure to consolidate and repay their debts and bills.

How do you know you have a low credit score?

When it comes to bad credit history, you must have a clear understanding of what is recorded against you. To do this, we recommend you request your credit report and carefully review it. Currently, everyone is entitled to a free and full credit report once every year from a credit provider in South Africa.

Apart from that, some companies will provide you with your account status, credit score, and a credit summary for a small fee. Let it be known that no company will ever tell you that you’ve been blacklisted. As such, a list simply does not exist. If you notice any errors, you should address these immediately. It is not uncommon for people to find that there are fraudulent items on their credit reports.

What is a bad credit score

A credit score can be seen as a number ranging from 300-850. This number shows how good your credit rating is. It depends on positive or negative information found in your credit report. This information includes the following:

1. amount of money that you owe;
2. payment history;
3. activity on a bank account;
4. the age of your accounts; and
5. credit checks that have been carried out on you

Additionally, your credit score simply shows all your good and bad financial behavior.

How does having bad credit affect you

Being on a blacklist can stop you from getting a loan to buy valuable assets like motor vehicles, property or even starting up a business. Yet, being blacklisted is nothing to be ashamed of. A great number of professionals have found themselves on a credit blacklist at one point or another. South Africans who are blacklisted can apply for loans to ease their financial concerns.

It is important to know that bad credit does not mean you can’t get a personal loan. Although you may not qualify for the products offered by traditional banks, you might qualify for those offered by other bad credit lenders. For this reason, you should always consider all of your options.

It’s just a matter of being careful about it. You should apply for a loan with different lenders within a short period such as a week or two. In this way, the applications will not have a negative impact on your credit record. In order to apply for credit, you must apply only to credit providers registered under the National Credit Act.

It is important to understand that loan sharks will offer you a personal loan for bad credit, but they will charge you high-interest rates and fees that you may not be able to afford. If your credit record is poor, you should consider bad credit and blacklisted lenders as alternatives to traditional lenders.

Am I going to be blacklisted forever?

The answer to this question depends on whether you are taking the necessary steps to repair your credit history or not. This is what determines how long you will stay blacklisted

How do low credit score loans work?

Lenders specializing in low credit score loans work on a golden rule. A Lender grants this loan on the premises that if there’s a default on any of the payment terms, the value of the assets you have pledged as collateral covers them. They may legally confiscate and sell the valuables to cover the cost of the outstanding loan plus interest.

Which type of loans can I get with a low credit score?

As stated earlier, being blacklisted doesn’t mean you have been totally condemned. There are still a few credit services you can enjoy. Some of these credit services include;

1. Payday loans

Some private lenders offer short-term microloans for blacklisted people. This is a form of unsecured personal loan, but they often come with difficult conditions and higher interest rates. It becomes quite difficult to borrow a large amount because paying back the interest plus the loan amount can become too exorbitant.

2. Secured loans

These types of loans are the easiest to obtain by blacklisted people. With this type of credit, the borrower has to provide an asset that belongs to them as collateral or security. This is so in a situation of default or breach in payback terms, the lender reserves the right to claim the asset. 

You can get this loan against your car, landed property or more. However, it is important to note that you risk losing your property if you don’t pay back the loan amount.

Financial providers that grant loans to the blacklisted 

Here is a quick list of companies that offer loans to people with bad credit.

1. Atara365 Loans

ATARA finance is one of the best credit providers that offer bad credit loans. They offer easy and convenient ways to apply for bad credit loans online. With a high approval rate and minimum info required, ATARA offers a minimum loan of R1000.00 and a maximum of R300 000.00. So, are you struggling to get a loan with bad credit, stress no more as ATARA loan’s got everything you need and more

2. Lime loans

Lime loans operate with a team of highly trained personnel and a combination of machine and technology. They’ve built the platform uniquely to serve their clients, even clients with bad credit.

3. Ezi finance

Are you in urgent need of finance but have a bad credit score? Ezi Finance can hook you up with a credible lending institution. Ezi finance acts as an intermediary between borrowers and credit institutions. With Ezi Finance, you don’t have to be running around sourcing for the best loans for your needs.

Other  financial providers that offer bad credit loans include;

• Blacklistedloan.co.za
• Nexcare Finance

Before actually applying for any of these loans, be sure to do your personal check on the terms and conditions of each of the companies. It’s wise to weigh all the options and choose the best of them. 

Alternative ways to get a Loan if you have Bad Credit

An unsecured loan from a family member or friend is definitely more comfortable for you. If you are blacklisted, you will have a better chance of getting finance as well. If you choose this option, you must ensure that all the details are spelled out in a contract to avoid disagreements and problems later and ideally have the funds transferred to your bank account instead of receiving cash.

Friends and family will be the cheapest and safe option if you need a small payday loan or just a little bit of money to tide you over until payday. You may still be able to get some assistance from your family and friends even if they are not able to lend you money directly. If As long as they have a stable and secure employment income, they can be your co-signers.

If you have a co-signer, you both take out the loan jointly and are responsible for its repayment. By doing so, the lender’s risk is reduced, and you can get a pretty good deal.

Conclusion

If you find yourself in a financially tight corner and in dire need of credit service but you are on the “blacklist”, do not give up hope. There’s a score of financial service providers out there that are willing to provide you with the finance you need. 

Most times, getting a loan from a financial institution is the right thing to do. This is because of the finance you need to solve a need. Some unforeseen expenses or needs may come your way. When this happens, the money you have on you might not be enough to solve your need. Some unforeseen expenses might be medical bills, car breakdown, floods and so on. Your little or no finance cannot help you out of these unforeseen expenses. BFS loans, how they work, requirements, and so on are all-inclusive in this article.

BFS Loans is a microfinance institution in South Africa. They discovered BFS loans in 1996. Their aim is to offer an ethical and innovative credit solution to people who were once employees. Also, people who do not have enough salaries can get BFS loans to cater to their needs. BFS provides loans on a short-term basis to individuals, salary earners, and small-scale business owners. BFS Loans are now known as Barko Loans. Their loans have a repayment term of 30 days.

BFS specially handles and collects information in a manner that makes its users feel more secure.

What are the requirements for BFS loans?

You must meet some requirements before you can get a loan from any financial institution.

The following are the requirements;

1. Provide your bank statement of account (recent 3 months)
2. Permanent employment for at least 6 months.
3. Provide your residential address
4. Your recent payslip.
5. An original ID book or passport.

Note: The major important factor is whether you can afford the loan. However, they will determine it with your monthly budget.

What is the minimum and maximum amount of loan that I can get from Bfs loans?

Every financial institution has the minimum or maximum loan amount they offer. You must know whether the loan amount they offer can cater to your needs before taking it. However, the minimum loan amount of Bfs loan is R400. whereas their maximum loan amount is R3,000.

How can I apply for the BFS loans in South Africa?

Different financial institutions have different ways of offering their loans, and BFS loans are not an exception to this.

 All loans, especially from different financial institutions, have how their applications work. And this sometimes differs from one institution to the other.

The following is how to apply

1. Go to any BFS head office or branch close to you
2. Ask for a BFS loan application form
3. Fill in your personal details or information into that application form. Details like; name, Bank Verification Number (BVN), email address, etc
4. Apply for the loans (the one you can pay back)
5. Then receive your loans in 5 minutes
6. Pay back the loans on time to avoid hurting your credit score

Repayment terms

In need of a loan to cater for your expenses, beware of the repayment terms of your loan. Prior knowledge of the repayment terms will help you decide the lender you prefer. Besides that, it will help you know whether you can pay back the loan with those terms. However, the repayment term of BFS loans is 30 days. Their automatic debit system quickly deducts your loan balance as the term states.

Contact details

If you need to make further inquiries about BFS loans. 

For support, queries or for more information you can contact BFS loans with the following details:

Phone number: 0807773777

Whatsapp: 0728806751

Email: customercare@barko.co.za, info@barko.co.za

BFS Head Office Address: Barko Financial Services LTD.

59 Burger Street, Lydenburg, 1120.

Conclusion

Loans give you the lifeline to solve your financial needs. The right repayment plan will help you overcome your financial needs with the amount of loan that you can repay. BFS offer their loans especially to people without employment in South Africa. This gives the unemployed hope and motivation to achieve their financial goals.

Loans provide a way out in our financial darkest moments. This moment of financial darkness exists because of our unending needs. Some of these needs arise unexpectedly and need an immediate reaction from us to prevent a terrible outcome. Game loans are in the game of ensuring that we win over those needs money can solve. Game loan review, its requirements, interest rates, and other information are all-inclusive in this article.

About Game loans

Game loans are a product offered by Africa’s largest discount retailer. Game is a discount retailer of mainly general merchandise. They are also retailers of non-perishable groceries for home, leisure, and business use.

In 1970, they opened the first Game store in Durban, South Africa. Operating out of 150 stores in 12 African countries..

Game operates out of 150 stores in 12 African countries.

Game loans have come into the forefront of credit services to ensure that South African people have adequate cash flow.

What are the Game loans requirements?

There are requirements that you have to meet before you can get Game loans. The requirements are:

1. You must be 18 years or older.
2. Have a valid South African Identity Card or a driver’s licence.
3. You should be an employee and earn about R2000 or more per month.
4. Provide the proof of income documentation while applying for the Game loans.

What is the maximum amount you can borrow from Game loans?

Before getting a loan, you would want to know whether the loan package available can meet your needs. This will help you weigh your options appropriately. The maximum loan could get up to R250,000. 

How can I apply for Game loans?

There is an actual way to apply for a loan, and this usually differs from one financial institution to the other. The following are how you can apply for a loan:

1. SMS your:  Identity number, initials, Surname & Monthly salary to 47562 and they will call you back. Example: 5018320012945*RT*Jade*8000. Your SMS will cost R3. Thereafter, they will call you back to complete your application.
2. Prospetive customers can also apply online. You can do this with your smartphone, tablet or personal computer. Then you’ll fill in your details and follow the procedure as presented (paperless).

What are Game loans interest rates?

Before taking up loans, we have to be sure of the interest rates for the loans. This will help us know whether we can measure up with the payback. The interest rate is as low as 15% of the loan.

Are there any additional fees?

There could be additional fees on loans. Those fees could be because of the customer risk profile. And these fees could change from time to time.

How fast are the Game loans released?

The pressing needs that led us to take up loans might not give us enough time. Because of this, full awareness of how fast we can get the loan is essential. If you apply for Game loans, you will get your cash in 24 hours.

Repayment terms?

Just as there are terms for loans in every financial institution, Game loans are not in exception of it. The repayment terms are flexible. It is usually from 12 to 60 months.

Conclusion

When we do not have any alternative to cash, loans are the only option available to us. Hence, we are on the lookout for the most reliable and trusted loan options. With 24 hours to get a loan considering the adverse effects of the pressing need, we would want to solve. Game loans’ timeliness with the provision of finance is what we should not overlook.

The South African government is partnering with FNB on its bounce-back loan scheme. Aiming to grow the South African economy and create jobs, the scheme provides additional funding to qualifying businesses. Through the course of this article, we would be taking an in-depth dive into FNB bounce back loans in South Africa.

According to the bank, it has already begun processing applications and will improve its processes over the next few weeks to ensure that customers can access the loans seamlessly across all channels.

“We are offering a loan scheme that is not about emergency financial relief, but is about contributing to the growth, development, and resilience of the entire SME sector,” said Gordon Little, chief executive of FNB commercial.

Why FNB launches ‘bounce back’ loans in South Africa

As Little explains, the previous Covid-19 assistance loans were restrictive in terms of the qualifying criteria. Also, what businesses could use the funding for. This kind of bounce-back loan application process is much simpler. Applicants have no restrictions as to how they can use the funding.

There are only two restrictions; loans cannot be used to repay shareholder loans or settle debt, and entities and sole proprietors must be tax-registered. This allows companies to invest the funds into the aspects of their business that will support its future growth.

FNB said it will prioritize the provision of bounce-back loans. The plan is to make the scheme a default term lending solution, for business clients with an annual turnover of between R0 – R100 million.

According to Little, this decision was taken to demonstrate FNB’s commitment to leveraging Bounce Back loans as valuable tools for supporting SME growth. “FNB wants South African small businesses to know that we are all in when it comes to supporting and growing their businesses.”

Who can apply for the FNB bounce-back loan in South Africa?

1. Any business (with a maximum turnover of R100 million per year) that needs relief for any reason.
2. Businesses that are looking to expand and scale.
3. A business with a good credit history and no arrears or judgments.
4. FNB’s credit application and granting process include a risk assessment and a bank credit application.

What do you get? 

The loan options range from a minimum of R10,000 up to a maximum of R10 million. According to FNB, the scheme offers very generous interest rates. Repayment terms are flexible enough to encourage uptake and ensure businesses are not put under financial strain.

Here is what getting an FNB bounce-back loan entails

1. Fixed Loan Term – The Bounce Back Business Loan has an amortization period of 60 months;
2. Early Settlement – Customers can settle the loan early and pay no penalty fees;
3. Automatic Payments – Customers can pay using a debit order from their business account on a date convenient for them;
4. Interest Rate – The loan rate is Prime + 3%;
5. The loan options range from a minimum of R10,000 to a maximum of R10 million;
6. You can only have one active Bounce Back Loan at a time;
7. There can be no repayment of existing debt through the loan.

How do businesses access the scheme? 

Participating banks will be able to provide Bounce-Back Scheme loans (banks that have opted to use the Scheme for their customers). DFIs and nonbank SME loan providers will be able to access the Bounce-Back Scheme through participating banks. This includes due diligence in compliance with regulatory norms.

The involvement of DFIs and non-bank SME loan providers will be based on financing charges that are subject to the due diligence and regulatory criteria of participating banks.

Do Bounce Back loans have to be repaid?

The Bounce Back Loan Scheme offers fixed-term loans for a period of six years.What’s my repayment schedule? In the first year, businesses do not have to make payments, However, beyond that time, they must return the loan plus any interest.

How much do I pay back on a bounce-back loan?

There is a variable interest rate of prime plus 3% on the loans. It further said that successful applicants had 60 months to refund the capital with no penalties for paying it early. This loan will work in the same way as FNB’s current business loan but at a reduced interest rate.

Do I need a business bank account for a bounce-back loan?

At least some of the banks offering these loans don’t require you to have a business account with them. Though it can be difficult to get the loans if you don’t have a business account with the relevant bank. Bounce back loans do not affect your eligibility for other government personal support.

Conclusion

The new “bounce back” loan scheme – aimed at helping businesses recover from the pandemic – has finally come into effect. The bounce-back support scheme, as named by the Treasury, will provide additional funding to qualifying businesses to grow the country’s economy and facilitate job creation..

A self-employed individual can be a freelancer working on multiple different projects at once, but without being officially employed by a company, or a newly-founded business owner with no stable or fixed income. South Africa’s lenders typically ask their borrowers to provide them with payslips, proof of a regular monthly income, and evidence of residence. Due to this, it can be quite difficult and sometimes impossible to get Payday Loans For Self-Employed.

Since self-employed individuals do not have any guarantee of work and income, they may find it difficult to get a loan in general.

If they have bad credit, things can get even worse and more difficult.

How do we know this?

The majority of lenders rely on their borrowers to have a strong credit score or to be able to provide collateral that will be taken over by the lender if the borrower defaults on their loan. Most lenders select this route because it almost eliminates the danger of not being repaid by a borrower.

Payday loans are regarded for being one of the more straightforward types of loans to obtain, especially when compared to traditional loans or loans that need collateral, such as vehicle title loans. Payday loans typically outperform other types of loans in terms of advantages, making them a perfect financial option for many people.

Good credit ratings indicate that the borrower has a track record of repaying borrowed funds on time. Collateral on the other hand entirely eliminates the danger of not being reimbursed because the borrower’s collateral may be resold to recoup the cash granted to him. if he or she fails to repay the loan.

If you don’t meet the first two criteria, getting a loan from a traditional lender is out of the question because they don’t care if you have a steady income or not; instead, they look at your credit score (which should be good) or whether you have collateral to offer if you don’t have any credit history..

In either case, bad credit score holders may find it difficult to obtain funding from a traditional lender.

What can be counted as time-taking? CREDIT CHECKS!

As a way to save time and fund borrowers as quickly as possible, payday loan lenders do not conduct credit checks. This is because credit checks can take quite a while. Since payday loan lenders offer short-term loans without credit checks, even those with bad credit can receive funding from them.

We can conclude that payday loan lenders offer cash to everyone regardless of their credit rating.

How Does Collateral Work for Payday Loans For Self-Employed?

Processing collateral takes time, which is another reason why payday loan providers avoid it. They don’t ask for collateral for two reasons. Firstly, it takes time. Secondly, they don’t see the sense in going through all the trouble of processing collateral for a loan of a few hundred dollars or less.

So, What DO Payday Lenders Rely Upon Afterall?

In order to grant loans to their customers, most payday loan lenders rely on their clients’ income statements. Apart from a few fundamental requirements, such as residing in the state in which they are requesting for a loan and being at least 18 years old, payday loan lenders rely heavily on evidence of income.

There should be no difficulty in sponsoring someone as long as they can show through their income statement.

Where can you get a payday loan for self-employed people?

Below are some lenders who offer loans for self-employed people:

1. Capitec

Self-employed individuals who receive their salary directly from their business can borrow up to R250 000. Nonetheless, informally self-employed people like freelancers and sole traders might not be eligible to apply.

2. Standard Bank 

For self-employed individuals, Standard Bank offers vehicle and home loans. The owner of the business will need to provide financial statements, as well as a statement of assets and liabilities.

3. Wonga

Prospective applicants can borrow short-term funds of up to R4000 as a new customer and up to R8000 if you’re an existing customer.

4. Nedbank 

Nedbank self-employed loans range from R2000 to R300 000 if you have a monthly income of more than R3 500.

5. Absa

When you have a regular monthly income of R2000 or R1500 on your bank statements, you can qualify for a personal or smaller personal loan.

6. FNB 

 If you qualify, you can borrow up to R300 000.

Conclusion 

Self-employed loans can be used to cover a wide range of financial needs, including business costs and personal expenses. In addition, self-employed loans are good for emergency situations since some of them provide fast payouts.

 As a self-employed individual, you can typically find a loan product that works for you if you have trouble getting funding in the past.