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Loan sharks in South Africa

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People take loans because of lack of cash flow. Of course, needs usually cause the need for the cash flow. Needs such as; payment of medical bills, school fees, groceries, vacation, etc. A lot of borrowers fall prey to loan sharks in South Africa. These loan sharks in South Africa target the most vulnerable of borrowers. Who loan sharks are, how to check legitimate lenders, etc are all-inclusive in this article.

loan-sharks-in-south-africa

Who are loan sharks?

Loan sharks are lenders of loans who do not have a license number. They are not legal lenders of loans. They lend their loans with enormous interest rates. Loan sharks lend enormous amounts of loan intending to gain a prime interest in a short time. Most times they target low-income and desperate families who do not have money to fend for their needs. It is never a good idea to borrow from them, no matter how friendly they might seem.

Sometimes, authorities see loans like payday loans or title loans that attract high interest rates as loan sharking.

Major characteristics of Loan sharks 

Loan sharks do not adhere to the microlending rules, so they should not be taken lightly. If you are unsure of the lending criteria, take note of the following when you submit an application:

  • The maximum amount of the loan is R10,000
  • Loans should be paid back within 36 months
  • Payment cannot be paid back using other forms of credit
  • The business must be registered with MicroFinance South Africa.

How do I find loan sharks

They can be found in underbanked neighborhoods, online, or through personal networks. Often, their funds come from unidentified sources, and they work for personal businesses or unregistered entities. A loan shark does not require a credit check or background check.

How to identify a loan shark

Identifying a loan shark is very important before venturing into any form of loan. This enables you not to be a victim of their exploitations.

  1. They usually offer little or no paperwork, such as a credit agreement or record of payments
  2. Most times they refuse to give information, such as the interest rate or how much you owe
  3. They take items as security for the loans they give you like; passports, bank cards or driving licences
  4. There’s an increase in your loan or add additional charges to your loan 
  5. Usually they refuse to allow you to settle your debt
  6. Most times they might resort to intimidating, threatening and blackmailing their victims
  7. They offer you a loan without assessing your current income
  8. Their business does not have a legal domain or address
  9. Such lender does not own a license number
  10. They charge interest rates far above regular rate 

How can I identify a legitimate lender?

Legitimate lenders are the lenders who comply with the National Credit Act (NCA) of South Africa. They have their registration numbers, which authentically approves their operation in South Africa. There are things you must do to identify legitimate lenders.

The following are how you can identify legitimate lenders:

  1. Know if they comply with the regulations of the National Credit Act (NCA) of South Africa
  2. If they did not list the lender as having a current authorisation to lend money
  3. Check for their contact information. You should have their phone numbers, email addresses and physical addresses. All the details above should be readily available on their website, even if it’s a lender that operates only online
  4. Look out for online reviews about their loans
  5. Know if they registered the lender

Risks of borrowing from loan sharks

There are many risks that borrowing from a loan shark attracts. You can avoid these risks by sourcing for a loan from notable financial institutions.

The risks of borrowing from loan sharks are:

  1. The interest rates you pay are way higher than the one you would through any legal borrowing
  2. They might harass, intimidate, attack or threaten you if you get behind with your repayments
  3. Sometimes they might pressure you to borrow more money to repay one loan with another. This definitely puts their victims into a spiral of debt that they can never repay.

Loan sharks in South Africa versus the law

Any form of harassment, be it from a lender, is against the law. They usually harass their victims, especially the vulnerable ones. Any loan from an illegal lender is automatically an illegal loan. Therefore, the loan shark doesn’t have any legal right to recover the debt. Most times, they threaten their victims with court prosecution and imprisonment if you cannot pay back the loan. But this is not possible because the loan from the lender (loan shark) is an illegal loan.

Can loan sharks kill their victims?

Accordingly, loan sharks are referred to as ‘Loan Sharks’ since they are like sharks. They are angry, aggressive and greedy. Besides that, to get their enormous interest rates and loan repayment, they can do many illegal things. These illegal things could be the kidnapping or even killing of their victims.

How can I cut ties with a loan shark?

Unfortunately, sometimes borrowers find out they are in the wrong hands (loan sharks). There are things you can do to cut off the ties you have with a loan shark.

The following are what you can do to cut ties with a loan shark:

  1. Get a financial advisor’s advice
  2. Ensure that the lender is actually an illegal lender
  3. Do not show the loan sharks that you know about their plans to victimise you
  4. Report such loan shark to the authority
  5. Report any pressure and threats
  6. Stop making further payments

Is borrowing from a loan shark illegal?

Loan sharks operate illegally. This is because it is illegal to lend money without a licence. But it is not illegal to borrow money from a loan shark. The loan shark would not have any legal right to take you to court if you cannot pay back the loan. This could be the reason they resort to violence, blackmail or threats to make their victims pay them back. 

Things while dealing with loan sharks 

It is important to educate yourself. Understand that legal institutions are legal for a reason, and the same is true for illegal lenders. Knowing the notorious facts around loan sharks is important if you plan to get involved with one. Think twice before you sign anything and always choose the safest option for you and your family. If you’re ready to go the legal route, here are a few tips:

Know what you’re getting into!

  1. If you want an estimate for the total amount of the debt, including repayments, get a quote first
  2. Disclose honest information where figures are concerned
  3. Leave greed at the door, only borrow what you need
  4. If you pay as much as you can over a shorter period rather than over the longest period, you will save a great deal on your total repayment
  5. Applications for credit insurance, that way you’re covered!
  6. Create a reasonable budget with all expenses considered, how much can you afford?
  7. Know your credit score, if not request it for free from Experian.

Other Ways of Borrowing Money

Always go to a licensed lender if you need a loan. You will still be able to find credible lenders who are willing to lend to you no matter how low your income is, how bad your credit rating is, or whether you only need a small sum for a short time. Although your loan agreement will still cover you under the Consumer Credit Act, you will still have to pay a high rate of interest. 

Licensing doesn’t guarantee you will get a good deal just because the lender is licensed.

A credit union can provide you with short-term loans for a small amount if you have a limited income. It is advised that credit unions encourage members to save money and borrow only what they can afford to repay.

Conclusion

No matter the financial need you have. Always remember that there are other options of loans you can explore in South Africa. Ensure you avoid any form of illegal loans from loan sharks. Notwithstanding that the loan sharks will offer you the enormous amount of money you need. You must prioritise legal choices of loans over the ones from loan sharks.

Iemas Loans – Everything you should know

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Iemas loans help borrowers with financial backup when they need money to fulfill their financial commitments. Some of these loans have either a long term or short-term period of repayment. Just like a business loan to improve your stand in the market or a personal loan to cater to your personal needs. Iemas loans are one of the many loan options to consider. There are other things to know about Iemas loans. How to apply for Iemas loans, what you need to apply, the benefits are all included in this article.

About Iemas loans

Iemas Financial Services Co-operative Ltd is South Africa’s largest cooperative society. They established it in 1996, offering a range of financial services to its members. They do this to run the company with their members and share profits. Iemas advise and support their members to ensure that they get quality product services according to their needs.

What are the requirements for applying for Iemas loans?

As mentioned earlier, Iemas runs as a co-operative organization. This means you become a member as soon as you subscribe to any of their products. Asides from being a member, you cannot get loans without some requirements. Therefore, in order to validate your loan request, provide the following requirements:

  1. ID or a certified copy of your ID.
  2. Three latest pay-slips.
  3. One month’s bank statement.
  4. Proof of residential address.
  5. Affordability assessment.

It would be nice to also know that Iemas loans have 60 months maximum term of loans. And also an annual percentage rate which is up to 34,85%.

What is the minimum and maximum amount of loan that I can borrow?

We could need a certain amount of loan, but we might not know the minimum or maximum amount of money that is offered by Iemas. The minimum amount of money that can be loaned to Iemas loan is from R1,000. While the maximum amount of money to be borrowed is from R200,000 with maximum repayment period from 60 months to 72 months.

How to apply for Iemas loans

With over 20 years of experience and over 20 branches across South Africa, getting a loan from Iemas can be hassle free. They also have a robust online platform to cater to the needs of their customers. 

  1. You can visit any Iemas office to get the loan.
  2. Fill out an application form which includes your personal details
  3. Select the loan package you prefer
  4. Submit your application
  5. You can also visit Iemas official website to apply for the loan. You will see their different loan packages. Then click “Apply.”

What loan products do Iemas offer?

Iemas offer loan packages to meet various engagements of the people. To get Iemas loans, you can consider the following loan packages:

  1. Personal Loans Consolidation Loans
  2. Education Loans
  3. Emergency Loans
  4. Home Loans

What is the interest rate of Iemas loans?

It is important to know the interest rates of a loan before getting it. This will help you know whether you can meet up with the full repayment of the loan and its interest. National Credit act regulates the Iemas Interest rate calculation. The interest rate of Iemas loans is from 23% to 60% per annum.

Features of Iemas loans:

Normally, you would prefer full information on the features of a given loan package before you can go for it. Iemas loans are really enticing because of the following features:

  1. Your qualifying loan amount is dependent on your individual profile, income, expenditure and credit profile.
  2. Unsecured and secured loan options are available.
  3. Members provide security for secured loans such as investments which are ceded, life policies with a cash or surrender value equal or more than the loan amount.
  4. The maximum repayment term is 60 months.

Can Iemas pay my debts?

Payment of debts through debt consolidation through Iemas is a means of paying debts. If your income has changed and you’re having trouble keeping up with your loan payments, talk to your creditor about your options. A consolidation loan is one such solution for managing debt before it’s too late. Iemas provides debt consolidation loans, which combine all of your loan accounts into a single account with a single interest rate, making it easier to pay off and manage your debt.

What you need to know about Iemas personal loans

Many people take out personal loans to assist them in reaching their goals and objectives, or just to lend a helping hand when they are in need. If you’ve never had a personal loan before and are considering applying, Iemas Financial Services, South Africa’s largest financial cooperative, provides a few facts concerning personal loans that you should know before applying:

Unsecured personal loans and secured personal loans are the two forms of personal loans available. The credit provider who lends you the money determines whether you qualify for the loan. They determine this based on your affordability and financial history with both forms of loans. Furthermore, a secured personal loan is backed by assets, so if you do not repay your personal loan, the creditor who loaned you the money may claim your assets.

You might wonder where you can get a personal loan. Remember that if your employer has a contract with Iemas, you have access to a wide range of low-cost financial products, including unsecured loans. Iemas have increased the maximum amount of unsecured personal loans from R80,000 to R200,000, as well as the payback time from 60 to 72 months, in order to keep their product offering competitive.

Does Iemas offer loans to blacklisted?

If a payment is missing for one month, a collections department may contact the client. But if a client misses payment for two months, the lender will send a letter of demand. The payment a client missed will appear on the client’s credit report. All loan amounts they have wiped off on any accounts will appear on the credit report. If the client does not make payments after they have sent the letter and no, they do not agree on any satisfactory payment arrangements. Then they will turn the account over to attorneys for legal action.

The first step in legal proceedings is to issue a summons, after that comes an application for a default judgment. In some situations, they will use a warrant of execution to seize commodities and/or property. At this point, they’ll blacklist a person showing that they have decided. Blacklisting has the effect of causing credit lenders to reject your loan application. Furthermore, being blacklisted has a negative impact on your credit score, which may prevent you from obtaining future credit.

How can you prevent yourself from being blacklisted?

You should try as much as possible not to be blacklisted. The first step is to notify your creditor as soon as you realize you won’t be able to make a credit or loan payment. When you notify them, they will then talk to you about other payment choices. If you work for an employer who has a contract with Iemas. You can apply for an Iemas personal loan, which they will withdraw from your monthly salary (depending on your affordability). This will help you stay on top of your debt responsibilities and keep a good credit score.

Benefits of having a loan with Iemas:

While looking out for loan options, making the right choice with benefits unlike other financial institutions, the following are the benefits of having a loan with Iemas:

  1. You won’t have to pay a penalty interest on your settlement amount.
  2. You save if your employer has a contract with Iemas to offer personal loans. They will withdraw your monthly instalment amount from your paycheck. This will help you not to pay any extra banking fees. There’s also no need to be nervous about skipping a payment. Isn’t it convenient?
  3. Iemas rewards await you when you use a product from Iemas, you become a member of the co-operative. This means that you get to share in the profits through their annual rewards payment.

Conclusion

They have made Iemas loans easily accessible to the South African public. The level of expertise, experience and transparency the professionals at Iemas Financial Services work with is very important to remember. Getting a loan when you need it is much safer when trusted experts, such as Iemas, handle it.

FNB Revolving Loan; All there is to know

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A Revolving Loan is a type of loan that is usually forgotten or never heard of by many people. Often when people find themselves in a difficult financial situation, they turn to loans to help them pay off their debt or just to ease the financial burden. An Fnb revolving loan is one of the best option for prospective applicants looking to take out a revolving loan.

Revolving loans are just as important as any other loan type, so let’s get right to the point and find out exactly what it means and how it works.

fnb-revolving-loans

What is a Revolving loan?

Financial institutions use revolving loans as means of extending credit to borrowers, giving them the opportunity to withdraw funds, repay them, and withdraw money again. The ease of re-borrowing and repayment features of revolving loans makes them a flexible financing solution.

Key Importance of Revolving Loan

Thought there are numerous importance on revolving loan to both personal individuals and businesses, the following are the major importance; 

  1.  Revolving loan facilities offer borrowers a great deal of flexibility when it comes to repayments and re-borrowing.
  1. The interest rate on a revolving loan facility is typically that of a variable line of credit, rather than a fixed rate.
  1. Businesses can use a revolving loan or line of credit to fund working capital requirements and continue operations, such as paying payrolls..
  1. When the customer pays down an open balance on the revolving credit, that money is once again available for use, minus the interest charges and any fees.
  2. When the customer pays down an open balance on the revolving credit, that money is once again available for use, minus the interest charges and any fees.

How Does an FNB  Revolving Line of Credit Work?

When a borrower has been approved for revolving credit, the bank or financial institution establishes a set credit limit that the borrower can use either fully or partially over and over again, as needed.

Generally, a borrower pays interest monthly on his or her current balance. Due to the convenience and flexibility of revolving credit, the interest rate on this type of loan is typically higher than on traditional installment loans. Revolving credit has variable interest rates, and those interest rates may be adjusted. 

What Fnb Revolving Loan offers you:

  1. Fixed monthly repayments – making it easier for you to budget
  2. The loan will be available to you for as long as you need it
  3. The ability to access the funds at any time, provided you have paid up to 15% of the Revolving Loan
  4. Optional Debt Protection available in case of your death, permanent disability, retrenchment and temporary disability.

What documents do you need to apply

  1. Green bar-coded South African ID Book
  2. Proof of residence
  3. Spousal consent (if married in community of property)
  4. Depending on employment type, we may require further documentation (i.e. 3 month’s payslips or bank statements, etc.)

Fnb Revolving Loan Debt Protection

With FNB’s Debt Protection Plan, you and your family can make repayments on Revolving Loans (credit facilities) after you pass away or become disabled. In the event of temporary disability or retrenchment, FNB will provide help with your monthly installments on the covered facilities.

Advantages of FNB Revolving Loan

Just like every other form of loan, obtaining a revolving loan with FNB has the following benefits;

  1. Gain access to these funds once you have repaid 15% of the Revolving Loan
  2. Set up monthly debit orders to repay the loan
  3. Only pay a minimal monthly fee when you use the loan
  1. Transfer funds from your Revolving Loan directly into your personal checking account through;
    1.  ATMs
    2. Mobile banking
    3. Telephone banking
    4. Online banking
    5. FNB Mobile Banking App.

Conclusion 

The flexibility that comes with taking a revolving loan with FNB cannot be overemphasized. This form of loan, unlike other types of loan permits an account holder to borrow money repeatedly up to a set amount limit. The prospective borrower repaying a portion of the current balance due in regular payments.

How to Get a Loan Without a Payslip in South Africa

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Getting a loan without a payslip in South Africa can be difficult. If you have ever tried to get this type of loan, then you should understand how difficult it is to get a limited loan.

Applying for a loan without a payslip or bank statement is unlikely to get approved for a loan at your bank. Banks and other financial institutions will turn you away if you don’t have the required documents, such as a valid bank account, bank statements and payslips.

All hope isn’t lost though as this article contains all you need to know about getting a loan without a payslip. Let’s dive into it!

What are loans without payslips/bank statements?

Loans without payslips don’t require South Africans to provide a payslip or a bank statement to get a loan.

Loans without payslips are designed for people who are unable to produce conventional forms of identification, including pay stubs. These loans are intended for self-employed people, independent contractors, and people with inconsistent income sources who would have trouble meeting the normative standards of traditional lenders. 

What are the requirements?

To qualify for loan without a payslip/bank statement, you must be;

  1. You must be 18 years and above.
  2. Prospective applicants must be a citizen of South Africa with an ID.
  3. It is necessary to have a bank account.
  4. Prove of income.

How do I show income proof without Payslips

Demonstrating income without payslips requires alternative methods of verification. Here are some ways to show income proof:

  • Bank Statements: Bank statements show regular deposits and transactions as evidence of income.
  • Tax Returns: Submitting tax returns can serve as proof of income, especially for self-employed individuals.
  • Letter from Employer or Clients: Obtain letters from employers or clients confirming income received.
  • Financial Statements: Presenting financial statements from your business or personal accounts can demonstrate your financial position.

Types of Loans Without Payslips

  1. Personal Loans

Some lenders offer personal loans without requiring payslips. Eligibility criteria may include a good credit history, bank statements, and alternative income verification. Interest rates vary based on the lender and your financial profile.

  1. Secured Loans

Secured loans, such as home equity loans or car title loans, may not always require payslips. These loans are secured against collateral, reducing the lender’s risk. Interest rates tend to be lower compared to unsecured loans.

  1. Peer-to-Peer Loans

Peer-to-peer lending platforms connect borrowers with individual investors willing to fund loans. While payslips may not be necessary, borrowers need to show creditworthiness and income through alternative means. Interest rates depend on the platform and individual investor terms.

Where to get loans with no payslips in South Africa

Here are some go-to lenders that provide personal loans with no payslip or bank statement in South Africa.

  1. RCS no payslip loan South Africa

RCS approves loans ranging from R1,000 to R150,000 without a payslip. New customers can apply for a maximum loan of R4000 with a 3-month repayment period. Therefore, your loan limit increases with time, which affects the repayment period. Alternatively, their repayment period ranges from 12 to 60 months.

  1. Loan City personal loan

A loan amount of up to R300,000 is available at Loan City. The loan amount varies with the loan duration – longer loan durations lead to larger loans. You can also choose the repayment amount and terms that match your financial situation. 

Loan applications do not require any documents, and you will receive approval immediately. For approval, you only need to show your source of income – even a letter stamped with your address,  not necessarily a bank statement or payslip It is also possible for people with bad credit to apply.

  1. FNB no payslip loan

FNB bank is one of the few banks that approve loans without payslips. Their loan limit offer for this loan is R125,000. You can pay your loan off in as little as 12 months or as much as 60 months, depending on your needs. In addition to their annual interest rate of 28%, they charge an initial fee of R800 and a service fee of R68.40.

  1. Peer-to-peer lenders

P2P lending sites such as Gumtree, Rainfin, and Peerfin allow you to find loans without payslips and bank statements. P2P platforms enable borrowers to find lenders in a way that is simple and convenient. Depending on your credit profile and credibility. 

A short questionnaire must be filled out and there are a few minutes of waiting time involved in the application process.  Lenders might ask for additional documents if you need a lot of money.

  1. Binixo

South Africans can borrow up to R9,000 from Binixo’s no-salary loan program. The payment period varies from four to sixty-five days. The application process involves filling out a short questionnaire and a few minutes of wait time. Upon receiving the confirmation, the money will appear in your account.

Alternative Income Proofs

Apart from the methods mentioned above, there are other alternative income proofs that lenders may accept:

  • Rental Income: If you earn rental income from properties, provide lease agreements or bank statements showing rental deposits.
  • Government Grants or Benefits: Proof of government grants or benefits can be used to demonstrate income.
  • Investment Income: Provide statements from investments, dividends, or other sources of income.

Conclusion

In South Africa, obtaining loans without pay stubs necessitates ingenuity and unconventional techniques for proving income. There are a number of solutions available, even though they could be difficult, such as peer-to-peer lending, secured loans, and personal loans. People can obtain finance that meets their demands by using alternative income proofs such as bank records, tax returns, and letters from employers or clients. To make the best borrowing decisions, it’s critical to investigate lenders, comprehend eligibility requirements, and evaluate interest rates.

Frequently Asked Questions

Can you get a loan from African bank without a payslip?

No, you cannot get an African bank loan offer without a payslip. The reason is that they need to see your last three months’ bank statements as assurance that you can repay the loan after issuing it to you.

Can I get a loan without a payslip if I am self-employed?

Yes, as a self-employed individual, you can obtain a loan from a reputable lender without a payslip. Lenders such as RCS, Binixo, and FNB can issue you loans in South Africa without requiring payslips.

Absa Overdraft – How to Get an Overdraft in South Africa

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Credit practice is as old as humanity itself. Though they seem to evolve as time goes by, they still fulfill the same purpose of alleviating financial emergencies. An Overdraft is just another interesting form of credit. When you need some emergency cash, an Absa Overdraft could be the answer for you.

Through this article, we will take a deep dive into all there is to know about.

What is an Overdraft?

An overdraft is essentially a short-term credit solution that lets you continue withdrawing money from your bank account even when your balance is zero or below. Unlike loans, where you borrow a fixed amount, an overdraft gives you access to funds as needed, up to a pre-set limit.

Think of it as a financial safety net. If you’re facing an urgent need for cash but don’t have enough in your account, the overdraft covers the expense. You only pay interest on what you’ve used, and it automatically repays once funds enter your account. It’s that simple!

Absa Overdraft: Personal Use vs. Business Use

Absa offers overdraft facilities tailored not only for personal use but also for businesses. Both options provide flexibility and financial support, but they serve different purposes and come with distinct features.

Personal Overdraft

  • Designed for individuals who need quick access to additional funds for personal expenses, whether it’s for handling an emergency, paying bills, or covering short-term cash flow gaps.
  • Flexible limits based on your income and credit profile, making it accessible for a wide range of customers.
  • Linked to your personal transactional account, so you can access funds easily and only pay interest on what you use.

Business Overdraft

  • Specifically designed for businesses of all sizes, from SMEs to larger corporations, to manage cash flow fluctuations, handle operational expenses, or seize growth opportunities.
  • Larger credit limits are available compared to personal overdrafts, reflecting the financial needs of businesses.
  • Repayment flexibility allows businesses to cover expenses without the need to take out long-term loans. Like the personal overdraft, interest is only charged on the amount used.
  • Customizable limits and terms, meaning businesses can adjust their overdraft facilities to match their operational needs.

How Does Absa Overdraft Work?

Absa’s overdraft is a flexible facility linked to your transactional account, giving you immediate access to funds when your balance falls short. Here’s how it works:

  • Instant Access: Once approved, the overdraft becomes part of your account, and you can use it as needed.
  • Pre-Approved Limits: Based on your financial profile, Absa will set an overdraft limit you can draw from. The amount depends on your creditworthiness and income level.
  • Flexible Repayment: No fixed repayments! You repay your overdraft whenever money enters your account, reducing the balance automatically.

To apply for an Absa overdraft, you’ll need to meet certain requirements, including being over 18 years old, having a steady income, and passing a credit check.

Qualification requirements for an Absa Overdraft.

The following requirements are necessary to qualify you for an Absa Overdraft;

Personal OverdraftBusiness Overdraft
Have a regular monthly income of at least R2 000 per monthHold an active business current account with us
have a cheque account into which your monthly income is paidIndividual guarantee of the principal.
Be 18 years or older–

How to apply for Absa Overdraft?

Applying for an Absa overdraft is straightforward and can be done through various methods depending on your customer status and the mode of access.

If You’re an Absa Customer:

  1. Absa Online: Log in to yo4ur online banking account, navigate to the “Offers” section, and select the overdraft option under “Transactional Solutions.”
  2. Absa Banking App: Log in, tap on “Offers,” and choose the overdraft facility. Follow the prompts to complete your application.

If You’re Not an Absa Customer:

You can apply by opening a cheque account, such as the Gold Value Bundle or Premium Banking Account, which includes an overdraft option. Alternatively, you can visit any Absa branch or contact their customer service on 0860 100 372 for assistance.

Key points to note before applying for an Absa overdraft

Before applying for an overdraft or any financial product at all, it is important to know the facts about that product. Some key points to note about Absa overdraft includes;

Repayment term

Absa overdrafts come with a flexible repayment plan. You only get to pay a once off initiation fee of up to R1 207.50 on a new facility. A monthly service fee of R69.00 and monthly interest on the portion of the overdraft limit that you used. 

Interest rate

Absa bank uses the Personalised Annual Percentage Interest Rate (APR), up to the maximum of Prime +10,5%. 

Estimated interest repayment:

The estimated monthly interest repayment for an overdraft limit of R15 000 at an interest rate of 15% per month where R8 000 of the overdraft limit has been used is R100. 

Benefits of an Absa Overdraft?

Some notable benefits of obtaining an overdraft includes;

  • An overdraft is linked to your cheque account, making it easy to track and manage transactions.
  • Helps to maintain an excellent credit history by avoiding debit reversals due to insufficient funds.
  • Convenience, because your overdraft facility is granted for an agreed time period
  • Peace of mind, knowing that you can cover any shortfalls in your account or monthly cash flow, up to an agreed limit
  • You only pay interest for what you use.
  • Get an optional credit protection plan to settle the outstanding balance in case of death, disability, dread diseases or retrenchment. 

Conclusion

Getting an overdraft can go a long way in mitigating personal financial emergencies. Be it for health, home or maintenance, technology has eased literally every process for our convenience. The only distinction between an overdraft and personal loan is the fact that an overdraft drawer has to own an account with the financial institution to qualify.