Small-credit is a loan formula which has been intended for people who do not meet the criteria of conventional banks. If it is mainly aimed at developing countries, it can also be aimed at people on a banking ban.
Yes, banking bans can borrow
By law, it is entirely possible for a banking prohibition to borrow from banks. Indeed, there are people in banking prohibition due to an issue of bad check, but who have a stable standard of living. Unfortunately, the various banking institutions view banking bans with a negative eye, especially fearing their insolvency.
This is the reason why it is all the more difficult for these profiles to borrow via the traditional circuit of banks. Fortunately, these people can always turn to small-credit institutions which offer financing solutions adapted to their situation.
Small-credit, an easy borrowing solution
You should know that small-credit is a solution that offers a boost to households so that they can get out of a bad patch. Generally, small-credit grants borrowers small amounts, up to 2000 or even 3000 USD in some cases. It is therefore not a loan that will be used to finance the acquisition of a house, but rather to settle certain situations, such as paying for car repairs, buying furniture, a computer or financing training.
But small-credit can also help banking bans. For example, a person issued a bounced check of 2000 USD when organizing the funeral of a loved one and found himself in a banking ban, not having the means to repay the amount in one go. This person can then apply to small-credit organizations, borrowing the said amount in order to settle his creditor. Once the banking ban has been lifted, this person can quietly repay their loan up to a few monthly payments.
Pledges, essential for small-credit institutions
Although small-credit can help people in a prohibited banking situation, you should know that not everyone can benefit from it. Indeed, this type of institution requires solid guarantees from their borrowers. Obviously, these guarantees are more important than those required by conventional banks, since this is a particular clientele that presents significant risks compared to unpaid debts.