"Online Personal loan" vs "Traditional Bank Loan"
Online Personal Loans vs. Traditional Bank Loans
Why Personal Loans Might Be Your Best Choice
Loans are one of the critical elements in ensuring financial stability: they provide relief during emergencies, help in buying big items such as a house, and also help in debt consolidation. Where savings are insufficient, good and reputable lenders offer a safer, more structured way of addressing financial needs. It is important to select an appropriate loan since personal loans offer several advantages compared to traditional bank loans. This article explores why personal loans can be the perfect fit for your financial needs.
Understanding Personal Loans vs Traditional Bank Loans
What is a Personal Loan?
The distinctive feature of personal loans is that they can be unsecured and are offered not just by banks. Credit unions and online lenders could provide them without any collateral. Since these loans have a very low bar of requirement and have an Easy Approved Loan nature and fast approval, they are particularly suited for emergency or urgent cases. Personal loans are also more flexible compared to bank loans which are often tied to specific purposes. Here are some key benefits/features of personal loans.
Key Features of Personal Loans:
1. Versatility (Freedom and Easy Usability): Borrowers can use personal loans for various purposes, including medical emergencies, weddings, vacations, home improvements, or debt consolidation. ACOM (M) adds to this versatility by providing customers a wide-ranging option in their financing amount, ranging from RM250 to RM100,000.
2. Quick Disbursal (Fast Approval Personal Loans): Many lenders offer easy applications with minimal documentation, making approvals and disbursals faster. This can make them literal life-savers for urgent financial needs, such as medical or other unexpected expenses. ACOM (M) makes this even easier through their online options and their fast approval personal loan processing time.
3. Accessibility (Easy Approved Loan): Because they don’t require collateral, personal loans are available even to individuals who don’t own significant assets. At ACOM (M), you can apply for their Easy Approved Loan with a basic monthly income of just RM500.
4. Transparency (Easy Repayment Terms): Personal loans typically come with fixed interest rates and predictable monthly payments, and there are no hidden fees, making budgeting easier. ACOM (M)’s repayment tenure is particularly flexible as they allow borrowers to settle their repayment from as quick as 6 months to as long as 60 months.
What is a Traditional Bank Loan?
A bank loan is a broad term that refers to any loan provided by a traditional bank. These loans are often categorized based on their purpose and are often secured. Some common types of bank loans, tied specifically to their purposes, are the self-explanatory Home Loans and Car Loans, Education Loans for further studies, and Business Loans offered to entrepreneurs for business expansion or operational needs.
Key Features of Bank Loans:
1. Purpose-Specific: Most bank loans are designated for specific needs, limiting how borrowers can use the funds.
2. Collateral Requirements: Many bank loans require assets such as property or vehicles as security.
3. Longer Processing Times: Due to stricter approval procedures, bank loans often take longer to disburse.
4. Lower Interest Rates for Secured Loans: Since these loans are backed by collateral, they generally have lower interest rates than unsecured personal loans.
A Scenario Where Personal Loans Outshine Bank Loans
Traditional bank loans are often perceived as safer because they are more conventional, but personal loans offer greater versatility and speed. Unlike bank loans tied to specific purposes, personal loans can cover home, vehicle, education, business, or special events like weddings and vacations without lengthy approvals.
Mr. Isaac was a traditionalist. Throughout his years, he has always gone to the bank first whenever he needed financial support. Despite his friends introducing him to ACOM (M), he had always been sceptical of non-bank financial service providers. But life is often unpredictable. Lately, upon discovering that he had a ‘not-yet-terminal’ medical condition that required urgent attention, he realised that the waiting time for bank loans was no longer a viable option.
Remembering his friends’ conversation about ACOM (M)’s Easy Approved Loans and particularly the fast approval of their personal loans, Isaac decided to give it a try. Through the process, he found that because personal loans aren’t designated to any specific use, they provide unrestricted access to funds, allowing borrowers to use them for any need. In addition, because personal loans are unsecured and do not require collateral, he didn’t need to risk any of his assets.
The easy requirements, flexibility, and fast approval of ACOM (M)’s Easy Approved Loans meant that he didn’t need to worry about meeting criteria, borrowing set financing amounts and/or whether he would be tied to any specific repayment tenure. ACOM (M)’s personal loans can be approved within hours or days once the basic documentation is completed, and the funds received within a week. He didn’t need to go to an office to apply for the loan because ACOM (M)’s online option can be done entirely remotely through the Internet, streamlining the process and cutting back the requirements of in-person visits, paperwork, and a longer processing period.
Isaac discovered Flexibility in Terms and Usage, Easy Approved Loans (no collateral needed), Personal Loan Fast Approval (which results in quick disbursal), and simpler eligibility requirements through ACOM (M)’s personal loans.
Why Choose ACOM (M) Over Other Personal Loan Services?
ACOM (M) outcompetes other personal loan providers through several ways:
1. Reasonable Interest Rates:
Because they are unsecured, many personal loan lenders charge higher interest rates compared to secured bank loans. ACOM (M)’s interest rates are reasonable and easy to repay.
2. Non-restrictive Loan Amounts:
Personal loans usually come in smaller amounts compared to traditional bank loans due to their lack of collateral. ACOM (M) offers a large range of financing amount options ranging all the way to RM100, 000.
3. Potential Credit Score Impact:
For many personal loan providers, missing payments or defaulting on a personal loan can significantly impact a borrower’s credit score. ACOM (M) chooses to have a more positive perspective, encouraging existing clients to manage their finances to have good credit scores so that they can benefit from the Top Up Loan service.
These are just some ways ACOM (M) is one of the top-tier personal financing services in Malaysia.
Choosing The Right Loan
Personal loans offer flexibility, faster approval, and no collateral, making them highly suitable in cases of emergencies and debt consolidation. In comparison, secured bank loans have lower interest rates and higher amounts granted, but the qualifications are stricter and the time for approval is longer. It is always worth looking at one's financial condition, the capability to pay back, and the purpose before choosing any type of loan. These will help immensely in making the right choice.