As with other loan types, there are also advantages and disadvantages of an SMS loan. Of course, they are worth knowing before you take out the loan. SMS loans are probably best known for their drawbacks in the general population, but there are actually some benefits to this type of loan, for example, when compared to a bank loan. Read the article here and learn the pros and cons.
The benefits of an SMS loan
Let’s start with the attractive things that can be with an SMS loan.
One of the good things about an SMS loan is that it is easy and quick to apply. You will often get a response within a few hours. If you get approved, you will receive the money within just a few business days. This whole process is much faster than you know it from a bank. For example, if you have an unforeseen expense that you cannot pay, you can quickly get rid of it with an SMS loan.
Another popular benefit of an SMS loan is the high degree of anonymity. You will not be asked until what you need to spend the money on. The loan company simply assesses you based on your income and expenses – not whether to buy a trip or a car.
If you take out a bank loan you will usually have to provide a security for the loan. It may be in the form of a car or other. It is the creditor’s assurance that they can get the money back in a way if you do not pay your bills. This security is often not provided by an SMS loan. If you do not own your home or a car, you can still borrow money.
Easier to get approved
In general, it is easier to get approved for an SMS loan than for example a bank loan. The collar is not as tight, but they are still there. For example, you must often be over 20 years of age and must not stand in RKI.
Let’s get to the disadvantages, because they are certainly also present with an SMS loan.
High cost of the loan
The interest and fees on an SMS loan can quickly come to the high end. They are because there are fewer requirements for you as a borrower. Thus, interest rates will be higher. The same will be the price for various fees.
Many providers create confusion
There are a huge number of providers in the Danish market for SMS loans. It can create confusion for consumers. Therefore, it is always recommended to apply for several different loans so that you make a better choice.