4 Unspoken Rules in Choosing a Payday Loan Lender – What to Know

Mar 26, 2020

Thousands of loan lenders fill South Africa to cater to the growing demand of people’s need to receive instant loans. A lot of South Africans resort to payday loans to solve a financial emergency immediately. These include hospital bills, tuition fees, property mortgages, or other instances that require fast cash. 

Since there are a ton of options in the market, it is wise to choose a loan lender that gives you the best deal among the rest. However, more often than not, the marketing campaigns of most lenders lack accuracy and transparency. 

If a fraudulent company’s marketing fluff manages to fool you, you become an easier target to trick into getting a loan. With that said, it is crucial to determine the best money lender who only has your best intentions in mind. 

Here are four unspoken rules in choosing the best loan lender that will give you access to the safest, quickest, and cheapest loan available.

 

1. Shortlist certified lenders

 

Check for certificates of authorisation to determine if companies are legitimate and not fraudulent. Most South African lenders proudly display their documents online on their website. With a license, you can rest assured that they offer legit services. 

Certified companies only offer interest rates that comply with the guidelines mandated by the government. With government-regulated lenders, you can expect not to get overcharged with interest from your payday loan. It will also help if you’re knowledgeable about government-regulated laws to know if a lender is trying to exploit your ignorance.

 

2. Check if they have a physical location

 

About 40 per cent of South African lenders are fraudulent or charge their clientele with interest rates beyond the guidelines set by the government. Of the 40 per cent, 98 per cent are only online-based, which means they don’t have a physical location. The lack of a physical office means that you can not directly visit them when you’re having difficulties with your loan. Don’t pick lenders without a physical store, as making them accountable for a failed transaction is complicated. 

 

3. Determine if they offer 24/7 customer service

 

Only the best payday loan lenders are capable of offering a 24-hour customer care hotline. It may be in the form of a hotline, live chat, social media, or email. With reliable customer support, you’re more confident that you’re in capable hands. 

Pro Tip: It is crucial to check how fast they respond to queries too. Sometimes, you might need answers instantly. With that in mind, you should remove a company from your list of potential lenders if they require more than 24 hours to reply to your question. 

 

4. Study loan regulations and laws

 

It is your responsibility as the loaner to study loan regulation and laws. A substantial understanding of the law helps protect you from potential scams or exploitation. In doing so, you avoid paying excess money from what you owe the company. 

Conclusion

Finding the best payday loan lender in South Africa can be a lot of hard work. However, the benefits will outweigh the efforts that you’re supposed to do. Aside from saving money on choosing the cheapest interest rate, the four unspoken rules mentioned above help give you the financial literacy to avoid fraudulent transactions. In doing so, you maintain your financial freedom while enjoying the benefits of your loan.

Are you in need of a payday loan in South Africa? Get in touch with us to see how we can help.