Olamide Famuwagun

Life can be unpredictable, a financial expense that one isn’t prepared for can throw off an individual or even a family off course and sometimes lending from family and friends may not cut it, so what do you do? This is where KwikPay comes in.

How much can I get from Kwikpay?

KwikPay is an online platform where you can get a quick loan in Nigeria. It uses your monthly salary to determine your credibility and approval, and disbursements are sent within minutes and loan amounts range between N10,000 and N2 million naira. This loan can be used to pay for expenses such as school fees, hospital bills, travel etc. 

Am I eligible for a Kwikpay loan?

To be approved, the following factors are considered, 

1. Your monthly salary and 
2. The length of service (how long you’ve employed for) and the position in your company.

 The loan is typically about 50% of your monthly salary and the repayment plan can range between 3 – 6 months. 

What are the benefits of KwikPay

1. You can make the decision on the amount you want to lend. So for example, if you get approved for more than you need, you can lower the amount so you won’t be obligated to repay an amount you don’t need. 
2. You can get approval in minutes which is really helpful in cases of emergency 
3. You can set up your repayment tenure and the money is sent into your account within minutes
4. Your salary is used to determine your loan amount which is done so that you can borrow within your financial limit
5. No application fee, no admin fees and collateral are needed. 
6. There are no hidden fees. Interest rates are communicated upfront. 
7. The repayment process is very easy. The payment is taken directly from your bank on the specified date or by using pre-written and pre-signed checks provided at the time of application. The checks will only be paid in on the date written on the check. Also, a reminder is sent to you via email at least three days before the repayment is due. 

How to apply for KwikPay Loan

1. Must be over 18, be employed and have a Nigerian bank account
2. Online application form
3. Completed Employee Status Inquiry or Employer’s Confirmation Form
4. Evidence of employment confirmation – Employment contract and/or recent letter of promotion (if applicable) works
5. Employment ID and valid means of identification (passport, drivers license, national ID etc.)
6. Credit checks (If you’ve taken any loans prior to this at any financial institution in Nigeria, the repayment of these loans are factored in)
7. A guarantor may be needed (this is dependent on loan amount)

Conclusion

KwikPay is an easy and available option when unplanned financial commitments occur. The process is available 24/7 online and approval and disbursements are done within minutes.

To get more information about the process and any other questions you may have, you can visit their website at www.kwikpaycredit.com or send an email to them at info@kwikpaycredit.com. Bear in mind that we have agents at loanspot who are also willing to help you through the process. Click here to reach out to us!

Everyone needs a little financial push now and then to meet their needs. Loans help to give such a push, but most loans are for business purposes and usually require a guarantee in collateral. Not every financial need is mainly for business, and so there’s a space for personal loans; consumer lending deals with this kind of loans. 

What is Consumer Lending?

Consumer Lending refers to loan services provided for personal or household use. They are long-term loans made by banks and other financial institutions to individuals. These loans are generally unsecured as opposed to business or commercial lending, meaning they do not require collateral.

Why do people need consumer lending?

Consumer lending provides funds for personal, family, or household needs. Suppose Mr Johnson, a mechanic, seeks finances to pay for his children’s school fees or to pay for the rent — Mr Johnson would need a consumer loan provided by his bank or any other financial institution. 

Where can one get consumer Lending?

Accessing consumer lending is not a difficult task, as consumer loans can come from a host of money lenders in Nigeria. These loan providers include financial institutions or other loan platforms such as PayLater and O-Kash. You also need to compare the loan from different lenders to see the one which you would prefer or favorable to you.

What are the types of consumer loans?

Consumer Lending provides consumer loans for many individual/family-related purposes. The most common types of consumer loans include:

• Personal loans: These loans help meet personal purposes.

• Auto loans: These loans facilitate the purchase of cars for personal use.

• Home loans: Also known as mortgage loans, they are used in payment of loans or house purchases.

• Student loans: These loans help to pay for tuition or academic purposes.

• Credit cards: Credit cards are a type of loan where borrowers have a limit to which they can spend on any purposes. The loan is repaid along with interest at a specific date. 

Check out: 5 Good Reasons To Borrow Money – Why you need to start borrowing

Do consumer loans require collateral?

Consumer loans can either be secured or unsecured. Secured consumer Lending involves loans that are backed by collateral. In the event where the borrower defaults (not paying back the loan), the loan provider has something to take over or fall back on. 

Unsecured consumer lending, however, is the exact opposite. This involves loans that are not backed by collateral. If the borrower defaults in payment, the lender has nothing to fall back on. 

What categories of consumer loans are there?

Consumer lending involves loans that are either close-ended or open-ended. 

Open-ended loans are loans given to meet any purposes up to a predetermined limit. At a specific date, the borrower has to make a payment on a minimum amount of the loan. Interest is charged on loan if the borrower cannot pay this back at the agreed time. An example of open-ended loans is credit cards. They are usually unsecured. 

Close-ended loans are given for specific purposes. Usually every month, repayment of close-ended loans is made by instalments. Close-ended loans are typically secured loans. 

Conclusion

Consumer loans are the best option if you’re on the lookout for quick ways to finance personal spending. Their primary appeal is the speed at which they are issued and the fact that most do not require collateral. If your are looking for a small or micro loan, you can read more about it here.

A letter of guarantee is an agreement issued by a bank on behalf of a customer or company who proposes to acquire goods from a supplier. Don’t confuse this with Letter of Credit, though.

The letter assures the supplier of payment on behalf of the customer, even when the customer of the bank defaults.

It is applied for by a customer. After the bank evaluates the risk and they are comfortable, they will back the customer with a letter of guarantee.

Basics of a letter of guarantee

These letters are used when a party in a transaction is uncertain that the other party involved can meet a financial obligation. They are usually used in purchases of expensive equipment or other property.

They are used in a wide variety of business situations such as declarations during export and import processes, and sometimes in contracting and construction. The bank negotiates how much they will cover with their customer.

When is a letter of guarantee required?

• New Supplier

Suppliers change contracts often with several customers. Therefore, customers are likely to provide a supplier with a letter of guarantee since a new supplier won’t have a history of transactions with the new customer. The uncertainty that exists between the two parties will require a letter of guarantee. 

• Trade outside usual Trading Area

For businesses that take place overseas, you may need a letter of guarantee to show commitment to pay for products. This often happens among import and export businesses, suppliers of goods outside a country may require assurance from a bank that they will receive the fees should clients cannot pay.

• Startup Company

Some start-up companies may not have the funds to finance the purchase of goods at the start. They may require a letter of guarantee when purchasing goods.

The Process for a Letter of Guarantee

The following process is followed:

1. Examining and Issuing a letter of guarantee

When an application for a letter of guarantee is filed, a bank determines whether the customer qualifies for the transaction. This is done by reviewing the underlying deal, the customer’s credit score and other relevant material. Additional information or documentation from the customer may be required.

2. Fees.

The fees for the transaction are determined by using the principles and rates as stated by the regulations of the bank.

3. Amendment of letter

The letter may be amended by the involved parties to include the adequate requirements of parties. The subject of Amendments consists of the underlying asset, validity period and so on.

4. Compensation against a letter of guarantee

When a supplier has supplied goods or rendered services to the customer and make claims for compensation from the assuring bank, the bank notifies the customer of the request. The bank then examines the claim and certifies that they meet the required claim clauses of the letter. If they are met, payment is made to the supplier for the stipulated amount agreed.

5. Post-Guarantee Management

The bank updates its customer’s record to reflect changes when the bank has made payment to the supplier. The details of the letter are stored ad verified to ensure that it reflects the actual transactions.

Conclusion

A letter of guarantee is used when parties (buyers and sellers) or business, and customers do not want to make a trade credit agreement. A letter of guarantee is a promissory letter that protects and prevents the financial risk of a supplier or producer. 

Cooperative Loans in Nigeria

Considering the harsh realities facing Nigerians amidst the global lockdown and the projection of the world economy slipping into depression, access to loans is an excellent way to jump-start the moratorium on most businesses.

People seek different ways to access to loans, usually with minor success, but few know about how accessible loans are through financial cooperatives.

What is a Financial Cooperative?

A financial cooperative is a financial body that is owned and operated by its members. A financial cooperative aims to act on behalf of a unified group of people while offering traditional banking services.

These bodies are more concerned about the financial stability of its members rather than focusing on profits as banks would.

It is basically a peer to peer social lending platform, and they vary in sizes and form.

The structure of Financial Cooperative.

These cooperatives have open membership. The members of the cooperative are the owners and as well the customers. The size of the cooperative depends on the number of members who take part. The more members a cooperative has, the more resources it offers in financial products.

Financial cooperatives are usually known for its low-interest loans and sometimes zero-interest loans and high-interest savings. This comes in very handy when you’re trying to manage your debt. Some financial cooperative have retirement plans in place for its members. Credit unions are an excellent example of a financial cooperative.

Types of cooperative in Nigeria

Primary Cooperative– Operations of primary societies permits its members who live in the same locality and share the same goals and aspirations to go into synergy to achieve their goals collectively.

Secondary cooperative. These cover a more extensive range of operation. It’s formed by the combination of two or more primary cooperative societies with its members and shareholders. They are the union and councils.

Tertiary Cooperative – These consist of both primary and secondary cooperatives. 

Industrial Cooperative – This is created by people who have the same craft or employment in common.

How to get a loan from a cooperative society

1. First, join a cooperative of your choice, preferably one that’s focused on uplifting its members financially.

2. After you join the cooperative of your choice, you must inquire about the loan services.

3. Be a member of the cooperative for a specified period before you can be eligible for a loan. This period may vary depending on the bye-laws of the cooperative.

4. The requirements of cooperatives will differ depending on different unions, but unlike banks that deal majorly with asset-based lending, the processes required for loans in a cooperative society are less strenuous.

5. Loans are granted at a very low-interest rate to ease repayment for their members.

Conclusion

Cooperative lending is also being protected by the state and federal laws of Nigeria. This is to ensure that it treats its members equally and settle disputes among members. It is a brilliant approach to consumer lending, really. Also, know that the cooperative loans could also come in different forms other than cash – it could come in the form of asset acquisition, land, mortgage, etc. 

In most cases, membership is open to everyone. As long as you belong to the organization or locality, the cooperative society is created for. And it is one of the best ways to get a loan in Nigeria with little or no interest.

If you need quick cash and you have run out of options, the one place to look for such emergency loans is your insurance policy. Although it is important to note that you can only take out loans on permanent life insurance policies which is available either as a Whole Life Insurance or Universal Life Insurance. You need to study how to get Insurance loans.

While taking a loan from a life insurance policy can be an easy way to get cash when you need it. There are some specifics to know before you decide to take up a loan on your insurance policy.

How Insurance Loan Works

These loans work slightly different from a bank loan or credit card. Insurance loans do not affect your credit score, unlike other types of loans, and they eliminate the process of approval from the credit bureau since you are borrowing from yourself. When you take a loan in Nigeria on your insurance policy, you need not explain how you intend to use the money. You can use for anything, ranging from bills payment to vacation expenses or an emergency. 

Also, tax authorities don’t recognise the loan as an income, and as a result, it is free from tax. However, it is expected that a policy loan will be paid back, and interest is also payable on these loans. Though the interest rates are usually much lower than the interest payable on bank loans, and there is no required monthly payment upon the borrower.

Paying Back the Loan

Even with all the accumulated benefits of taking out a loan on a life policy, the loan needs to be paid back promptly. This is because of interest accrued on the loan amount on regularly, and it doesn’t stop your mandatory monthly obligation of premium payment. Interest is attached to the loan balance and accrues regardless of when bills are being paid either monthly or not. This could result in putting your loan at risk of exceeding the policy’s cash value. In the event the insurance policy lapses, you must pay taxes on the cash value.

Insurance companies would naturally provide many opportunities to keep the loan current and prevent the insurance policy from lapsing. In the event the loan balance is not paid back at the time of death of the borrower – then the loan balance plus interest will be deducted from the amount the beneficiaries are to receive from the death benefit.

Conclusion

In summary, you should keep the following takeaways in mind whenever you want to opt for a loan on your life insurance policy

• Taking a loan on your life insurance policy can be an easy way to get an emergency fund when you need it.
• You can only take out a loan on either permanent or whole life insurance policy.
• Policy loans are always taken against the borrower’s death benefit, and the insured use the policy as collateral for the loan.
• Insurance companies (the lender) will add interest to the loan balance, which accrues whether payment is made monthly or not.

In the recent past, getting a payday loan from a commercial bank required a lot of paperwork and bureaucracy with the availability of collateral and a guarantor. This process usually took weeks or sometimes even months, thereby draining the loan applicant physically and mentally. 

The emergence of fintech companies changed the landscape of how lenders offered loans in Nigeria. With the help of mobile technology, the fintech companies were able to disburse loans in minutes with no paperwork or guarantor. It led to fast exponential growth in the credit industry with the Credit Bureau of Nigeria and the administration of Bank Verification Number (BVN) playing significant roles respectively.

In a bid to compete with financial technology companies, Nigerian commercial banks are launching quick and accessible payday loan platforms. They offer easy and fast loans to their customers without collateral and with a very low-interest rate as their trademark. 

In contrast to the old practice of granting loans with high-interest rate loans with loads of paperwork and a list of guarantors, among others, commercial banks now provide quick loans. One of the significant ways they offer these loans is through salary advances in fast and straightforward ways. They termed these payday loans.

What is a Payday Loan?

A Payday Loan is an amount of money lent at an agreed interest rate, and repayment is expected when the borrower receives his next salary.

Nigerian Banks with Payday Loan Offerings

1. Access Bank Payday Loan

With Access bank Payday loan, customers can enjoy the loan facility at low interest rates with no paperwork or collateral needed. 

This loan service is available to both salary and non-salary earners. It helps meet the emergency needs of customers at any time before their next payday. 

Access Bank USSD Code

The Access Bank payday loan is a 24/7 service that requires neither your physical presence in the bank nor any paperwork. It is an unsecured loan. This means that you are not required to provide any collateral.

You can access this loan in minutes using the Access Bank payday loan code – *901*11# or *426*11#. You can also use other channels like the Access Bank Internet Banking platform, WhatsApp Banking, or the Access Mobile App. 

2. GTBank Payday Loan

GTBank launched the GTBank payday loan and Quick Credit loan platforms to provide funds of up to N5m in a few minutes to its customers. 

The salary advance payday loan is only available to customers whose salary account is domiciled in the bank. They must have received a salary from the same employer in the past three months. 

The quick credit, on the other hand, is available to both salary and non-salary earners, and you can get between the sum of N10,000 and a maximum of N5m.

With no hidden charges, the bank charges an interest rate of 1.33% per month. This makes it a very cheap and competitive loan facility.

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Requirements for Accessing a GT Bank Payday Loan

• Applicants must earn a minimum of N25,000 for the public sector and N50,000 for the private sector.
• Thirty days tenor for a salary advance platform. Renewable every month
• For applicants who are not salaried earners, you must have had an inflow of a minimum of N20,000 to your account in the last six months.
• Applicants should be at least 18 years of age.
• Convenient repayment plan between 3 to 12 months

To apply for salary advance instantly, use the GT Bank payday loan code – *737*8*2# to begin but to confirm your eligibility and request for a quick credit loan immediately, dial *737*51*51#.

GT Bank Salary Advance and Quick Credit are readily available on all GTBank online and mobile banking platforms (Internet Banking, GTWorld, GTBank Mobile App, and Habari App).

3. Polaris Bank Salary Advance/Payday Loan

With Polaris salary advance payday loan, you can access up to 70% of your next salary in advance.

Loans can be processed and disbursed in less than 2 minutes using the Polaris USSD payday loan code *833*12#. See other USSD code for loans in Nigeria.

Disbursed funds can also be accessed 24/7 via ATM or your mobile device using USSD codes, PolarisMobile and PolarisXperience.

Requirements for Accessing The Polaris Payday Loan 

• Applicants must be in the employment of any reputable organizations in either the private or public sectors.
• Customers’ salary accounts must be domiciled with Polaris Bank.
• Other Terms and conditions apply.

4. Zenith Bank Payday Loan

Zenith Bank offers its customers the Zenith bank loan – a scheme designed to meet short-term expenses that may come up before the next payday. It is one of the top loan products offered by banks in Nigeria. Confirmed salary account holders of the bank can use the Zenith bank payday loan USSD code – *966# to access it.

Zenith Bank Loan Eligibility

• The salary and allowances of the customer must be domiciled in Zenith Bank.
• The bank has an Indemnity clause in its loan contract, giving the bank the Right to set off in any other bank using BVN. Upon payment default, they have the right to deduct your loan amount due to the customer’s different bank accounts. You can learn more about professional indemnity insurance.
• As an applicant, you can borrow up to 60% of your monthly salary.

Is It Advisable To Take A Payday Loan?

Payday loans are great for a quick fix. However, it is not advisable to make it a habit. They should not be a go-to solution for ongoing debts or recurring bills.

If you have a financial need, be sure to get all the facts before you consider borrowing against your next paycheck. It’s best to cross-examine your financial situation for smarter ways to free up any extra money or responsibilities before opting for a payday loan.

Loans are a big source of financial assistance for individuals and businesses. They provide an alternative source of income necessary for personal needs and achieving business goals.

As a person or a business, before you can approach a financial institution to borrow money, here are 5 checks to make you eligible.

1. Have a bank account:

You need to have an existing Nigerian bank account. Most financial institutions use your account details to verify that you’re eligible and also deposit your loan funds. Even if you’re getting an instant online loan in Nigeria, you’d still need a bank account for it.

2. Be of legal age:

 To qualify for a loan in Nigeria, you must be 18 years and above. Younger persons are not able to access loans from any platform.

3. Have a good credit rating:

Financial institutions will run a credit check to determine how likely you are to repay your loan. A good credit score will give you the best chance of getting approved with a good interest rate.

4. Meet Know Your Customer (KYC) requirement:

KYC stands for Know Your Customer. This is a standard verification process which requires you to provide the following:

Proof of Identity (D card, passport or driving license.)

Selfie (Photo of yourself, with your entire face visible.)

Proof of Address (bank/credit card statement or a utility bill.)

5. Be able to repay:

To access unsecured loans, a good credit rating is an indication of your ability to pay back. However, Secured loans require you to pledge assets (e.g. property, movable assets, etc) as collateral for the loan and a guarantee that will be able to repay.

As an individual or a company, you should understand the terms and conditions of a loan offer in order to choose the one that is best suited to your financial capabilities and needs.