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There are times in one’s life when you are thrown a curveball and find yourself out of sorts because you need an instant solution to a time-sensitive problem.
It may be an accident or hospital bill, an unexpected car repair, or a personal emergency that forces you to seek alternative solutions.
Taking a bank loan will not suffice due to the approval period that takes weeks to process. The active use of the internet has played a crucial role in our daily activities.
This includes but is not limited to obtaining cash online loans with easy payment channels.
A simple tap on a mobile app or a click on a lending website allows you to transact your loan application wherever you are, minus the usual long lines and waiting time.
1 What is an Online Cash Loan?
An online cash loan is a transaction done virtually between the borrower and lender, without the need for a face-to-face meeting. The exchange of information is part of the loan application process, which is quick and hassle-free. It has minimal documentary requirements, and the funds are released by direct transfer to your bank account or debit card.
Online Cash loans have become the easy choice to get hold of a quick loan. It has convenient features for a borrower:
- A borrower can compare the different lending rates and fees with easy search access on the internet.
- Information and online loan application can be done any time, 24/7.
- Online loans do not need collateral, a guarantor, or a high credit score.
- Unbiased and instant processing of loan evaluation, decision-making, and transfer of funds.
- No need to disclose financial details or history
- High rate of loan approvals that notify the applicant within 1-5 days.
- Instant disbursement of funds through bank transfer or GCash immediately after loan approval
2 Are You Eligible to Apply for an Online Loan?
As a borrower applicant, you will need to provide a few documents like a government-issued identification card to prove your identity. Your address and proof of income are part of the information you share with the lender.
An applicant must be employed in the same company for one year, self-employed, or a professional.
Here are the following criteria to be eligible for an online loan:
- A resident of the Philippines.
- You must have a residence address where you lived for at least a year.
- You must have a savings or current account
- You must have an email address.
- Some lenders will ask for proof of a minimum net monthly income of PHP 6,000.
The lending institution will also try to check for your creditworthiness. They will try to check your credit history if you have any previous loans and how handled and settled. To learn more about and how to check your credit score on this link.
3 How to Apply for an Online Cash Loan?
It is easy to apply for an online cash loan, but you must carefully choose the company you will borrow from. Once you pick the lending company you will transact with, you can do the following easy steps to apply for a cash loan:
- Get into the website of the lender company.
- Click ‘Apply’ on the product listing of your choice.
- Fill out the application form and click ‘Return’ or ‘Submit’.
- You will be informed of your successful application process and receive an email with your application details.
- Upload pictures of the required documents.
- You will receive a call from the lender within 24 hours from the time of application.
4 Dealing with Legitimate Online Lenders
A rule of thumb is to check if the lending company is registered with the Security and Exchange Commission (SEC).
It must be an established corporation following Republic Act No. 9474 or the Company Regulation Act of 2007. The company should have an office address that you can visit for any questions and operational on-site as a regular business.
Be wary of online companies that claim they work in the virtual world and do not need a physical office. You may be exposed to dealing with illegitimate lenders who do not practice lawful regulation.
Skipping the screening process to check legitimacy puts you at risk of unethical practices. This may include hidden charges or paying for upfront commissions because of your vulnerable situation.
5 Legitimate Online Loan Companies
|Online Loan Company||Maximum Loan Amount||Minimum Salary Requirement||Processing Fee||Maximum Loan Tenure|
|ACOM REVOMAX Cash Loan||500k||7,000/month||1,000.00||360 days|
|Global Dominion Financing, Inc. Doctors Loan||300k||0/month||5% of loan amount||360 days|
|South Asialink Finance Corporation (OFW Personal Loan & Seaman Loan)||250k||20,000/ month||5.5% of loan amount||360 days|
|Tonik Digital Bank Inc.||50k||0/month||500.00||720 days|
|RFSC Personal Loan||50k||15,000/ month||6% of loan amount||1-day|
|GCash Loan||25k||0/month||N/A||360 days|
|Cashwagon Cash Loan||20k||6,000/month||N/A||30 days|
|Asteria Personal Loan||20k||10,000/ month||10% of loan amount||360 days|
|TALA Philippines||10k||0/month||N/A||30 days|
6 Requirements to Apply for an Online Loan
It is advisable to prepare the following requirements before your online loan application. Take clear pictures of the documents that will be uploaded on the website after you complete the application form.
- 2 Valid government-issued IDs.
- Certificate of Employment or Income Tax Return (ITR) for self-employed.
- 3-months employment payslip or bank statements if self-employed.
- Bank Account with your indicated name.
- Utility Bill or Bank Statement as proof of address.
It will be advantageous to have a good credit history for a faster approval process. But if you are borrowing a small amount, the lending company will allow you to build a credit history with them and start with a smaller amount until you establish your credit history.
Read More: How To Set up a Corporation in the Philippines 2022
7 How to Check if Your Loan was Approved?
When you apply for an online loan, you create an account on the website and fill up the application form.
It takes a few hours to a maximum of one working day to process your information. When you log into your account, you can check the status of the application if it is pending, approved, or denied.
Once approved, the funds will be transferred and credited to your bank account, debit card, or GCash within 24 hours.
8 What Loan Details Should You Pay Attention To?
As you study each lending website, you should take note of the following details before you choose the company you will borrow from.
- Short-term Loan of 3,6,12 months tenure
- Turnaround Results of Application is 1-5 business days
- Interest Rate of 0.8% – 3% per day or 10% per month
- Processing Fees are charged depending on the amount of the loan
- Late Fees are charged for overdue payments
Read more: The Ultimate #1 Guide to Credit Score in the Philippines
9 How Do You Pay for Online Loans?
Payments can be done easily through the different payment channels without visiting the lending office. You can pay at your nearest payment centers indicated on the lending website of the company. Most of them have these payment options:
- GCash Payment to the Lending Company’s Contact Number
- Bank transfer to the account of the lending company.
- Accredited Payment Centers of the Lending Company
- Remittance Centers (M Lhuillier and Cebuana Lhuillier)
- 7-11 Convenience Stores via DragonPay
10 What Happens When You Fail to Pay Your Online Cash Loan?
As a borrower, you are responsible to pay for the online loan. You agreed to the terms and conditions and must comply with them. In the event you default on a loan, you will be contacted and pursued by a collection agency that will ask you to settle immediately or negotiate the amount and terms of payment to settle the balance of the loan.
While the Philippines does not have a centralized system to track the credit records of a person or be liable for jail time under Philippine laws, your credit history will still be affected. Lending companies have access to private financial entities with banks and other lending institutions that will affect your loan applications in the future.
Under the SEC Memorandum Circular No. 18 Series of 2019 of the Prohibition on Unfair Debt Collection Practices of Financing Companies and Lending Companies, unlicensed lending companies cannot engage in unfair debt collection either through their agents, representatives, or promoters.
You may also file a complaint to the National Privacy Commission (NPC) should the lending company practice unfair and unlawful harassment for debt collection.
Read More: 10 Ways To Make Money Online
11 Final Notes
Online Cash Loans allow you to get cash in a shorter period, unlike banks and other financial creditors. It is an easy and hassle-free process with minimal requirements that gives you the option of the amount and the monthly payment duration.
It is also a credible way to build your credit history for future transactions.
The option of an online cash loan with legitimate lending companies eliminates borrowers from falling prey to the hands of loan sharks or informal lending groups that mostly overlook lawful regulations.
It spares the borrower from unethical collection practices that violate one’s privacy and put in a humiliating situation.
Bear in mind, that online loans have a higher interest rate than bank loans.
It would be wise to borrow the amount needed and strive to pay the monthly payments on time. While getting cash is easy, it is recommended you finish paying one loan before you have to avail of another one.
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