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Personal Loan Products – Are they useful for repaying credit or a bad debt?

Consumers are looking for a new type of personal loan

Wonga.co.za, are well known in South Africa as a provider of quick, short term loans for customers who are looking for some money to tide them over before the end of the month. This is ideal when you’re hit by an unexpected expense, like a sudden car bill or emergency plumbing work. It’s for those sudden payments you did not see coming. Sometimes, your monthly salary just doesn’t cut it and can’t stretch the entirety of the month.

The obvious catch with the convenience of short term credit is that it’s ‘short term’ typically for around a month, before repayment is required. Naturally some people seek a loan that provides the convenience and speed of short term lending, but offers something more in terms of repayment flexibility.

If you’re one of these people you might be interested in Wonga’s new personal loans. The personal loan offers a repayment plan lasting up to 6 months, affording customers more flexibility through small monthly repayment instalments.

Does the maths check out?

As a typical example, if a customer borrows 4000 Rand for 30 days on a payday loan option with Wonga, the total repayment (including interest and fees) is 4735 Rand. With the new personal loans option, customers can borrow 4000 Rand for 6 months and the total repayment (including interest and fees) is 5400 Rand – which is paid back in 6 instalments of 900 Rand each month. This loan option is designed specifically for those consumers who need quick access to credit but want the cash longer than a typical payday loan, and shorter than other personal loan options which can last several years. The Wonga personal loan is the ‘in-between’ loan option that can help a wide variety of borrowers.

Applying for a loan online like this doesn’t take weeks like a traditional bank loan would. As long as you use a reputable loan company (read about the dangers of loan sharks here) you can be sure of a reliable process.

All you need to apply is a cell phone number, SA ID number, Bank account details and the last 3 months’ proof of income. With this, the money can be in your account quickly. You can apply online, using a handy slider where you can weigh up how long you want the loan versus the repayment amount. Wonga are clear that there are no hidden charges on their loans so you can also be sure of a transparent process.

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