Monitoring the situation of borrowers is very important for determining the prospects for economic development as well as financial institutions. The better the situation of borrowers, the naturally great interest in various forms of liabilities. Therefore, every leader should be interested in strongly improving their clients’ creditworthiness in a broader perspective.
In the article, you will see how the situation of borrowers looked like in recent years and now. Thanks to this, you will determine the potential for future changes, and thanks to the kindness of Good Finance you will learn about the best offers on the current market.
Shaping the situation of borrowers in recent years
In the nineties, after the political transformation in the country, not only retail banks developed, but also parabanks, rather negatively perceived in the social perspective due to usury interest rates on even short-term loans. Only a few years ago, loan companies handled payday loans without checking the actual creditworthiness of the client, in other words, the ability to repay the commitment.
Non-interest costs exceeded a reasonable range and the penalties for late repayments were not completely adapted to reality. For more than twenty years in Poland, there has been a lottery in the area of taking out cash loans, where even a slight economic misunderstanding resulted in the loss of assets, including the borrower’s real estate. Takeovers of borrowers’ non-current assets by parabanks continued until a recent change in the provisions regarding the granting of cash loans and consumer loans.
In 2018, the loan company is not entitled to service the obligation without a thorough examination of the customer’s creditworthiness. The actual income counts. In addition, the nominal interest rate, as well as non-interest costs, were regulated on a reasonable range.
Thanks to this, the situation of borrowers improved the most. It can be said that until 2017/2018 the situation of borrowers was not good. Now the credit market has cleared itself of dishonest, unprofitable, suspicious entities, and the shadow economy is already characterized by the small size.
What changes can you expect in the future?
For now, market observation is underway. Loan companies are experiencing considerable legal pressure and a large regulatory pattern. This means that most parabanks are transforming fixed-line branches into more profitable multimedia services for Internet loans.
With high probability, it can be assumed that over time typical branches of financial institutions will disappear.
The competition on the credit market will move towards customer service, building loyalty, and speed of servicing cash loans. Adjusting nominal interest and non-interest costs in loan agreements is the best thing that could happen to domestic borrowers.
Prospects for borrowers
The elimination / significant limitation of usury loans bodes well for borrowers. In recent years, trust in cash loans has increased significantly. Honest loan companies and major retail banks with a rational approach to customer service have benefited from this.
It can be suspected that the trend of positive changes in the credit market in the area of legal support for borrowers is still progressing.
The better situation of borrowers is also the better situation of lenders, especially those who approach formal care and meet the highest legal standards. Do you think that the situation of borrowers has actually improved in the domestic economy?