In the Philippines, microcredit practices are applied widely to reduce the poverty level and to provide access to finances to people who are not eligible for loans from a bank. There are many companies that issue microcredits. Interest rates vary greatly, but if one does proper research, it is possible to find companies to get microcredit with the most lucrative interest rates and the lowest requirements.

What Is a Microcredit?

Microcredit is a relatively new phenomenon in the financial world. It came into existence in the 70-ies of the past century and was meant to help poorer people to achieve a better level of life through launching a small business, for example. Hence, microcredit practice was launched in an effort to reduce the general poverty level in the developing countries and to provide access to money to people who otherwise would not have it.

Where to Get Microcredit?

If you live in the Philippines, you can get microcredit from a number of lending companies. The most transparent and reliable from them are given in the table below. There, you can also find the most important details on a loan taken from them.

CompanyLoan SumInterest RateLoan can be taken for the period ofService FeeDeadline can be prolongated
Online Loans2,000 – 7,000 PHP for new borrowers. 2,000 – 20,000 PHP for returning clients1% per dayFrom 7 days to one month10%Yes, for a service fee of 700 PHP and additional interests applied to the balance
Cashwagon2,000 – 7,000 PHP12% per month, up to 144% per yearFrom 3 to 6 monthsN/AYes, for an additional fee
Atome1,000 – 10,000 PHP0,9% interest rate, applied on a daily basisFrom 7 days to 3 monthsFrom 7 days to 3 monthsYes, for an additional fee and interests
Robocash1,000 – 10,000 PHP for new borrowers, 1,000 – 25,000 for returning clients1,3% interest rate, applied on a daily basisFrom 7 to 21 daysN/AYes, for an additional fee, calculated individually

Pros and Cons of Microcredit

Microcredit, like any phenomenon in the financial world, has its advantages and drawbacks. The main advantages are evident for those who at least once had to apply for microcredit:

  • Microcredits are available for people with minimum requirements;
  • Bad credit history doesn’t matter when one applies for microcredit, a lending company cares of its own requirements and as long as the applicant complies with them, the lending company is fine with any credit history by other financial institutions;
  • Usually, microcredits are approved fast, within a couple of days maximum;
  • The entire process is performed online, without any need to go somewhere, sign something, and so on;
  • The funds are credited via a way that the person indicates as the most convenient one;
  • Usually, all loans are approved if one complies with the lending company`s requirements.

When it comes to drawbacks, the main of them is a very high interest rate that can exceed interest rates usually imposed by banks significantly. As well, hidden fees can be incorporated in the repayments. However, the practice of hidden fees is not common for the mentioned companies.

Microcredit, like any phenomenon in the financial world, has its advantages and drawbacks. The main advantages are evident for those who at least once had to apply for microcredit:

  • Microcredits are available for people with minimum requirements;
  • Bad credit history doesn’t matter when one applies for microcredit, a lending company cares of its own requirements and as long as the applicant complies with them, the lending company is fine with any credit history by other financial institutions;
  • Usually, microcredits are approved fast, within a couple of days maximum;
  • The entire process is performed online, without any need to go somewhere, sign something, and so on;
  • The funds are credited via a way that the person indicates as the most convenient one;
  • Usually, all loans are approved if one complies with the lending company`s requirements.

When it comes to drawbacks, the main of them is a very high interest rate that can exceed interest rates usually imposed by banks significantly. As well, hidden fees can be incorporated in the repayments. However, the practice of hidden fees is not common for the mentioned companies.

Microcredit, like any phenomenon in the financial world, has its advantages and drawbacks. The main advantages are evident for those who at least once had to apply for microcredit:

  • Microcredits are available for people with minimum requirements;
  • Bad credit history doesn’t matter when one applies for microcredit, a lending company cares of its own requirements and as long as the applicant complies with them, the lending company is fine with any credit history by other financial institutions;
  • Usually, microcredits are approved fast, within a couple of days maximum;
  • The entire process is performed online, without any need to go somewhere, sign something, and so on;
  • The funds are credited via a way that the person indicates as the most convenient one;
  • Usually, all loans are approved if one complies with the lending company`s requirements.

When it comes to drawbacks, the main of them is a very high interest rate that can exceed interest rates usually imposed by banks significantly. As well, hidden fees can be incorporated in the repayments. However, the practice of hidden fees is not common for the mentioned companies.

How Does It Work in Philippines?

In the Philippines, most companies have simplified the entire procedure to the minimum requirements. All that is required from a person is to register a profile on the website of the selected company. Further, the applicant selects the desired amount and the time frame for which he/she applies for a loan.

  • Further, it is needed to send a selfie with an officially issued ID and the ID scanned copy;
  • After that, one indicates the preferred way to receive funds;
  • The company proceeds with the application and sends a notification in the form of an SMS with an approval or denial.

After that, a borrower starts repaying the loan when the repayment date comes. One should make the repayment through before the indicated deadline to avoid fees for late payment.

How Much to Borrow?

The sum of the loan depends on such factors as the lending company, whether the person borrows for the first time or he/she is a repeat borrower. As well, the company pays attention to whether the person used to make repayments on time if he/she had already used the services of the company. And here, you can see the minimum and the maximum that you can borrow from the leading lending companies in the Philippines:

CompanyMinimum sumMaximum sum
Online Loans2,000 PHP20,000 PHP
Cashwagon2,000 PHP7,000 PHP
Robocash1,000 PHP25,000 PHP
Atome1,000 PHP10,000 PHP

Best Micro Credit Services

Whenever one is selecting a good company to get a microloan, several factors should be taking into consideration. One should check whether the entire procedure is transparent and clear. As well, hidden fees should be avoided if one does not want to get unpleasant surprises with sums of money to be repaid.

  • The sum of the loan should be sufficient for the current needs;
  • The interest rate should be reasonable, we mean affordable. Make sure you can repay your loan;
  • Customer support should be available constantly in case some issues with repayments, the loan itself or something else connected with a loan arises.

Microcredit Terms

Terms for getting a microloan should be clearly specified in a special section on the website. If you don’t understand something, customer support should be available to provide all the needed clarification in a way easy to understand. Terms in the mentioned companies, Online Loans, Atome, Cashwagon, Robocash, are clear and precise. Hidden payments are absent, and customer support is always available for any assistance a borrower might need.

Micro Credit Requirements

Usually, there is a minimum of requirements applied to microloans. Normally, they can be issued to citizens of the Philippines, holders of an official ID, employed or those who have a constant source of income. Usually, age limitations apply, but they vary significantly in different companies.

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