Don't risk financial ruin with express loans

Be wary of payday loans and express loans. Make sure you don't waste your money. So, here's what you should do.

Don't risk financial ruin with express loans
Never take out a loan in a hurry. Do your best to protect your financial resources. Photo by Yuri Krupenin / Unsplash

How many times have you received a flier while walking down the street offering you the loan you so desperately need to pay off your debts? Surely more than once.

The well-known "Express Loans" are offered by businesses through a variety of media, including the Internet, newspapers, brochures, and even social media, in an effort to entice you with minimal requirements, without checking your credit history, and the appearance that they are affordable and simple to repay.

Even while they appear to be the ideal solution to your financial issues, keep in mind that these are unlicensed institutions who just want to profit illegally from your fragility and financial need.

How do you tell if a business is legitimate or a scam?

They appear trustworthy and approachable, have (temporary) offices, and use data from reputable, licensed financial institutions to try to earn your trust. Additionally, they are situated in well-known structures or convey messages on social media platforms like WhatsApp if they are in public areas.

When contacting you, they request formal identification such as a passport or national identity card, credit card details, payroll information, and even invoices and certified copies of deeds. Remember that they hold the key to your finances and patrimony, therefore exercise extreme caution while disclosing this kind of information.

They request a cash advance payment, which is equivalent to 6% to 10% of the total loan amount, for administration or management expenses in order to purportedly provide the loan with few criteria.

Then, as if by magic, they vanish after the people have made the down payment. They often run for five to 10 days to gather the greatest number of naïve victims. They let you know that the loan is still being authorized at that point but has not yet been delivered in full.

Tips to avoid express loan scams

When you approach businesses that offer express loans, you face the danger of losing more than just your money since by disclosing personal information, you open yourself up to the possibility that it may be used to steal your identity and perform other scams.

If you need a loan, you can apply for a personal loan or payroll loan at a recognized institution. You can also choose to put something up for collateral.

When you are having financial difficulties, avoid acting in a desperate manner and instead try to find a solution without resorting to borrowing money.

Make sure the institution is legitimate and registered with the authorities if you need finance. Make use of the Financial Service Providers Registry System, a free resource that offers comprehensive details on the financial institutions that have been properly registered.