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In the past, most regular people could not get loans from banks. Starting about a decade ago, online lending platforms emerged to fill this gap. They offered the public an easy and convenient way to apply for and get loans. All that users had to do was to register on loan apps, apply for loans, and wait for their application to get assessed. If they qualified for a loan, they could get it in just a few hours.

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But digital lenders don’t all provide the same quality of service. Some have maintained a decent image; others have become notorious for their exploitative practices. Given this reality, you’ll need to carefully compare the available options before applying for a loan from any lender.

Here are six things you should in the lead up to requesting a loan from a digital loan platform.

Ascertain Their Reputation

This might look like a lot of work, but it really isn’t. Many online loan companies have been around long enough to build a reputation. If they’re one of the bigger players in the lending space, you’ll likely find a good deal of information about their activities on the web. Material relating to them would range from testimonials or criticisms to news reports.You may also ask your family, friends, or acquaintances about their experience with the loan providers they’ve used.

Read Reviews

Reviews aren’t always a fair assessment of a business’s performance. But they can give you an insight into how well they fulfill their promises to customers, and how they manage business-customer relationships. A few negative comments may not be grounds for skipping a lender. But if they’re a lot and appear in multiple review sites, you should probably forego the lender in question.

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On the other hand, if there are positive testimonials about a platform from a majority of appraisers, you may consider such a platform more closely.

Weigh Interest Rates

Digital lenders charge interest on the loan they give out. You will find information regarding this on their website, as well as on the app store from which they apps can be downloaded. It’s reasonable to compare what each lender expects you to pay, and go for one that offers the lowestrate. However, you should also consider their quality of service, just so you don’t wind up with a cheap deal that’s a cover for poor service.

Check For Additional Charges

There may be more to the fees that digital lenders present to you than meets the eye. Unfortunately, many people do not know about the extra charges they have to pay until they have taken out a loan. This is one of a number of problems that make borrowers’ experience with digital loan providers rather unpleasant. Be sure to find out every single fee you’d have to pay before deciding whether or not to apply for a loan.

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Thankfully, this information is often available on each loan app’s page on apps stores.

Read Terms And Fine Print

People complain about the inhumane treatment that they get from some online lending companies. And in many cases, their complaints are legitimate. However, it’s also true that a lot of digital lenders hint at their approach to collecting funds owed to them in their terms of use. This is why you shouldn’t absent-mindedly tick boxes when registering for their services. Read the conditions they give. Only assent to them if you understand what is written, and if you believe that the terms are fair.

Exercise Restraint

The idea of getting an instant loan (often without collateral) is what attracts the average person to lending apps. But beware the allure of receiving ‘easy’ money. Only apply for a loan if you’re sure that you’ll be able to repay it. A bit of discipline on your part can save you from the untold stress that comes with owing money to loan sharks.

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This article was first published on 4th November 2022

ikenna-nwachukwu

Ikenna Nwachukwu holds a bachelor's degree in Economics from the University of Nigeria, Nsukka. He loves to look at the world through multiple lenses- economic, political, religious and philosophical- and to write about what he observes in a witty, yet reflective style.

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