Mini-loans and Mini-credits Borrow money

Borrowing money, costs money. That is common knowledge, but sometimes emergency law breaks and you need a small amount to cover the month or make a small purchase. A miniature loan or a small one might be an option for you? Or does a money reserve suit your situation better?

The miniature

A mini loan (or SMS credit or flash credit) is a small loan that can usually be on your account within 48 hours. Usually these are small amounts: from small amounts such as 50 euros to 500 euros or in some cases to 1,000 euros.

In fact, it is the intention to use a mini-loan to bridge a period in which you are short of cash.

Request a money reserve here.
Compare various mini-loans and money reserves here.

Mini-exercises in Belgium

Flash credits are no longer accessible to new customers in Belgium. Existing customers can still receive a mini loan via SMS. All suppliers such as Ferratum and Payday have stopped offering their product in Belgium.

Why do you still read so often about miniature exercises? Usually people try to indicate that it is a small loan and use the term minilening because it is also well established in our language.
The mini-loan from the past where you could obtain a small loan via SMS to pay back within a short period of a week or a maximum of one month, is therefore no longer possible in Belgium. Nevertheless, we would like to give you an explanation of what this was all about, and we will supplement the article with some alternatives to obtain a small loan.

Minilening conditions and operation.

The procedure to obtain a mini-loan used to be relatively smooth. The first time the lender needs your data, of course, but afterwards you can easily request a new mini loan via SMS.

It is the intention that a mini loan is paid back quickly. Usually the repayment term is between 15 days and 30 days. The loan amount determined the period within which the small loan had to be repaid.

Minilening costs.

A mini loan would not cost more than 4.17 euros per month on a monthly basis. If we look at this borrowing cost on an annual basis, you could decide that it is an expensive form of borrowing money.

Because it concerns a loan for a short period (maximum 30 days) and because the total costs do not exceed the amount of 4.17 euros, this type of loan was not subject to the consumer credit scheme. The consequence of this was that it was not possible to compare loans on the basis of the APR because there was no legal obligation to calculate the APR.

It is therefore common for the above reason that a provider of flash credits does not charge interest, but then charges the maximum for the file costs. Because the providers have difficulty getting a profit on this, it is therefore necessary to indicate a deposit or to pay an institution that guarantees.
You also had to be at least 21 years old to enter into a mini loan and the first mini loan will be limited in amount.

Mini loan benefits.

Mini loan benefits.

Of course, a mini-loan had a number of advantages. Because we speak of relatively small amounts, the monthly burden will also seem small. In principle, these costs do not come back monthly, such as with an installment loan .

Even if you are blacklisted at the National Bank, you could still take out a mini loan. A credit check is only mandatory for loans that fall under the consumer credit law, but that does not mean that you could never be rejected.
If you tried to borrow from a party that you have already borrowed in the past and this did not go well, then they can still refuse your application. An additional advantage is that the procedure for applying for a loan runs smoothly, especially if it is no longer your first time. The first time it is necessary to provide data and then it takes just a little longer.

Minilening disadvantages

Banks like to respond to the fact that sometimes you need money in the short term. A mini loan / mini credit (the former flash credits) were therefore quite expensive, even though a cost of 4 euros seems to be low, but if you calculate this on an annual basis, you would quickly conclude that there are cheaper alternatives.

So think carefully about whether you can find other and better alternatives when you need a small loan. If you can not reimburse a mini-loan or money reserve the following month, then you can make the situation worse and that can lead to a vicious circle that is difficult to break.

Take part in a mini loan.

There used to be a number of lenders who specialize in cash loans. Well-known players included Ferratum and Payday. Today, you can no longer take out this type of loan, so you have to look for alternatives.

Alternatives can be: private borrowing from family or friends, borrowing through crowdfunding, taking out a money reserve or choosing a personal loan .

View here an overview: Compare money reserves and mini loans .

When to use a mini loan?

You could use a mini loan to cover certain periods of temporary shortfall. Just think of holidays where life is slightly more expensive. It may also be that in a certain month you are short on cash because of an unexpected expense that has occurred. Even then you can check whether a small loan can not offer a way out.

Because mini-loans no longer exist in the form of cash loans, we have to look for alternatives. For example, a money reserve can offer a solution for some people, but even a small loan on installment has its advantages, although you have to pay attention with certain lenders.

If the repayment is preferably spread over a longer period, then there is also the possibility to borrow money via private funds via crowdfunding.

Mini-loan or money reserve?

Mini-loan or money reserve?

Minibrafts from the past usually offered a small limited amount (for example from 50 euros to 200 euros), while a personal loan often starts from a slightly higher amount (usually 1,250 euros).
In this way one quickly comes to money reserves where you could apply for a credit limit for a smaller amount of 500 euros. With a money reserve you can also use the repaid capital again later. It is an expensive way to borrow money, but this flexibility attracts many types of people.

We have looked at some providers and below you can find a short comparison:

Interest rates are always informative and temporary, so they can undergo change and / or depend on the loan amount.
Representative example : Credit opening indefinite duration of 2,000 euros, annual percentage rate (APR) of 9.50% (variable annual debit interest: 9.50%) + possible costs card (fixed price or% of the outstanding balance). Request an exact calculation from one of the above parties. (*): Interest rates are a snapshot. They are therefore purely informative and temporary, can undergo changes and / or be dependent on the loan amount.
Representative Example : Loan on payment of € 50,000.00; Term is 120 months . You pay € 516,02 monthly for a JKP of 4.50% . The total amount to be repaid is € 61,922.40. For an exact calculation, request an offer from the above parties.

Small personal loan

With a personal loan (= loan on payment) everything will be agreed in advance. Sometimes you can designate a specific goal (for example, buying a car or financing a renovation). In these cases, you will usually be able to obtain cheaper interest rates because there is evidence to be submitted.

You can also request a personal installment loan without a specific purpose. The purchase of a new refrigerator or to finance your trip are examples of this. The interest rates for these personal loans will be higher because there is no specific purpose for them, but usually still lower than a money reserve.

Both the loan amount, the loan period and the monthly repayments are fixed. This offers more security because you can estimate in advance what the impact of the reimbursement will be on your monthly budget.

Compare personal loans

Depending on the purpose of the loan, but also the lender you choose, the interest rate on personal loans can vary considerably.

We therefore always recommend to compare different loans with each other and always carry out a simulation on the lender’s website. In this way you can always use the most up-to-date figures, find the cheapest loan and compare contract conditions.
The total cost of a loan is expressed with the APR (Annual Cost Percentage). This indicates the total cost of a loan on an annual basis. So you compare personal loans with the JKP. Compare a number of personal loan providers below:

Interest rates are a snapshot. They are therefore purely informative and temporary, can undergo changes and / or be dependent on the loan amount.
Representative Example : Loan on payment of € 50,000.00; Term is 120 months . You pay € 516,02 monthly for a JKP of 4.50% . The total amount to be repaid is € 61,922.40. For an exact calculation, request an offer from the above parties.

Borrow privately?

Loans between acquaintances and / or family are more common than you might think. It is the ideal opportunity to borrow a small amount of money without having to go through a major administrative burden.

We do recommend to always use a debt confession for smaller amounts. Depending on the agreements made, you can repay the amount on a fixed date or in disks. Afterwards – or with each partial refund you can have a confirmation of receipt signed as proof that the small loan has been repaid. Perform everything electronically so that it is easy to follow.

A private loan is a way to borrow cheap money without a bank. This is certainly suitable for small loans to absorb a temporary financial shortfall. For larger amounts, it is always wise to work with a private loan contract. More information about this can be found on this page .

Borrow money through crowdfunding for private individuals

Crowdfunding for private individuals has been possible in Belgium since 2017 via the Mozzeno platform. It offers private investors the opportunity to make their savings profitable through the provision of loans. Borrowers can then borrow money to finance their own projects.

In this way, Mozzeno tries to return to the basis of traditional banking without complex procedures. Those who want to borrow money through Mozzeno will find that the structure is quite similar to that of online lenders offering personal loans: after all, you can also designate a target or borrow money without a specific objective.

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