Minicredit are the type of product market younger funding. They were born just a few years ago and it can be said that they are “children of the crisis” since they were created to cover a series of needs that were arising mainly in the families most affected by the economic crisis of recent years.
These needs are to cover small unforeseen expenses that families and people have and that with the ordinary income they have monthly they cannot meet.
They are small expenses, between € 300 and € 600, for which there was no simple answer since long-term loans or fast loans did not provide a perfect solution.
Hence the mini-credits were born. Today we are going to see what mini-credits are, their main characteristics, what cost they have and tips so that their hiring does not imply that you over-borrow.
Characteristics of mini-credits
Before hiring any financial product you should know it well. Know how it works, its characteristics and what financial solutions it is focused on. That way you won’t get nasty surprises by hiring something you really don’t need.
This is even more important when we talk about financing products, such as mini-loans, which can cause excessive indebtedness and that you have serious economic problems if you do not use them carefully.
Therefore, the first thing is to know what are the characteristics of a mini-loan:
– Simple hiring process : Hiring a mini-loan is a very easy process. In most cases you just have to fill out a short form, with very specific data, such as your personal data, the amount of money you request, an account number, an email address and a mobile phone number.
– Fast response : The company to which you request the mini-loan will respond affirmatively or negatively to your request in a very short time, usually in one s15 minutes after filling out the form.
– Small amounts : The mini-loan is focused on covering small expenses so you can only ask for amounts of money ranging between € 300 and € 600.
– Very short period of time: The period of time to return the borrowed money is very short. This time is one month maximum.
As you can see, mini-loans are very simple and quick financing products to hire but first you must be sure that it is what you really need, since financing yourself regularly through mini-credits can lead to important health problems for your personal economy.
How a mini credit works
The mini-credits are very simple products but it is important to know how they work and how to know them more thoroughly.
– Hire a mini-loan : The mini-credits can be hired through the internet, and sometimes, by telephone. Some mini-credit entities have an app from which you can request the mini-credit directly on your mobile.
– Maximum amount: The maximum amount that you can request in a mini-loan does not usually exceed € 300, being the maximum in cases where you have already requested a mini-credit before and have not had problems of non-payment, of € 600.
– Speed : From the moment you request the mini-loan and you have the money in your account at your disposal a few hours pass. Normally the whole process starts and ends in a maximum of 24 hours.
To have the money in your account as soon as possible, you must follow these steps:
– Keep the documentation that they are going to request close to you : This documentation is your ID, a bank statement and proof that you have monthly income.
– Make sure that the mini-credit entity works with your bank : This way when you transfer the money it will arrive almost instantaneously because it is a transfer. But if they are different banks then it is a transfer and can take up to 48 hours.
– Request the mini-credit during working hours : If you ask for the mini-credit on weekends or after working hours it will take longer to receive the money since there will be no one working or less staff to handle the requests.
How much does a mini-credit cost
Possibly this is the most important aspect you should know about any financing product and even more in the mini-credits that are a type of product that misused causes you serious economic damage.
The first thing you have to know about the cost of a mini-loan is that the APR is not a good orientation point to know the real cost of a mini-credit.
The APR is an annual rate and the mini-credits have a very short period of time, of days, one month at most.
Therefore, you should look at the fees. These fees work like interest on a traditional loan. It is the amount of extra money that you will return for every € 100 requested.
For example, you request a mini-credit of € 300 to be returned in a month, the total amount being € 360. That is, the fees are € 60. € 20 for every € 100 requested.
Now that you know what a mini-loan is, its main features, its operation and the real cost they have, you can know perfectly in what situations it is a good idea to request it and in what situations it is not advisable to do so.
The important thing to avoid problems is that you do not get used to paying your expenses through mini-credits, only use them at specific times when you do not have liquidity to face an unforeseen expense.
You already know that from Conan the Barbarian we put at your disposal a complete blog, with a lot of information about mini-credits and other types of financing products so that you have all the possible data at all times.
Also remember that we have a personal chat where you can consult all your doubts and questions regarding any of the financial products that we show on our website or about the operation of Conan the Barbarian.