Buzz
The prominent advantages include easy requirements, straightforward procedures, favorable interest rates, especially with numerous cash lending options, making cash advance more preferred by many. Among the various cash lending methods, customers typically utilize the following 2 methods:
The banking sector offers a wide range of borrowing options for businesses and individuals, ranging from installment plans to mortgages.
2. Various Forms of Unsecured Cash Loans
Within the realm of unsecured cash loans, there are further categorizations, namely:
a. Loans based on ID card and household registration book
Loans based on ID card and household registration book require only the provision of an ID card and household registration book without the need to prove income, but a guarantor is required.
* Characteristics
- Only need to provide ID card or household registration book to borrow.
- No need for home appraisal.
- Flexible borrowing amount and repayment time.
- Maximum support for borrowing from banks or financial organizations is 70 million dong.
- Borrowing period is 6 - 24 months.
- Simple borrowing documents, after 3 - 7 transaction days, you will have the money in hand.
b. Loans based on cash salary
Borrowing based on cash salary is a form in which banks or financial institutions lend to customers who receive monthly cash salaries for consumption purposes in life.
* Loan Requirements
- Vietnamese citizens must be at least 21 years old, with a confirmed permanent residence.
- Must have been working at an organization, company, or enterprise for at least 3 months.
- The average monthly cash salary received in the last 3 months must be at least 3 million dong.
- Customers must not have bad debts.
* Loan Application Procedures
Requirements and procedures for unsecured loans
After meeting all the loan requirements, you need to prepare the following documents to facilitate the bank transaction for you to borrow cash easily:
- Photo size 3x4
- Copy and original of ID card
- Certified copy of household registration book
- Declaration of the most recent 3-month salary or any proof of salary confirmation document photocopy
- Photocopy of health insurance card
- Employment contract or alternatively a work confirmation document. Refer to the sample work confirmation document while working at the company for valid documentation.
Miscellaneous documents (required by banks, financial institutions)
c. Loan against insurance contract
This type of loan is applicable to customers with life insurance contracts who require unsecured loans. The principle of this loan is that the higher the monthly premium, the lower the loan interest rate.
- No collateral required, no need to prove income
- Large loan amount, up to 100 times the monthly premium
- Quick approval by banks, financial institutions in just about 2 - 3 days
- Flexible borrowing period from 6 - 36 months
- Low interest rate of only 1.66% per month
- Can be paid off early
3. Interest rates for unsecured loans
There are no clear regulations on the interest rates for unsecured loans, relying only on agreements between parties. However, banks typically apply interest rates ranging from 15 - 18% per annum, while financial companies apply rates of 20%.
For unsecured loans at banks, there are 2 methods of interest calculation as follows:
- Interest calculated on reducing balance: In this method, interest is calculated on the actual amount owed by the customer.
For example, if a customer borrows 47 million on 11/1/2019, with an interest rate of 16% for a 12-month term, using the reducing balance method, the customer will have to repay as follows:
- Interest calculated on original loan amount: This method calculates interest based on the initial loan amount.
For instance, if a customer borrows an original loan amount of 47 million at an interest rate of 16% per annum for a 12-month term, the monthly interest amount would be 47,000,000 x 16%/12 = 627,000 dong.
4. Financial institutions and banks offering unsecured cash loans
Currently, there are numerous financial institutions and banks offering unsecured loans, including:
* Banks
Many banks provide customers with unsecured loan options with various supports such as better borrowing conditions, preferential interest rates, and attractive programs... facilitating easy access to loans. Customers are choosing banks when seeking cash loans through unsecured means:
- Vietcombank
- Techcombank
- ABBank
- Baoviet Bank
- LienvietpostBank
- Maritime Bank
- VIB
* Financial organizations
In addition to banks, many financial organizations also exploit this cash lending method to provide customers with the best services, such as:
- Prudential Finance
- FE Credit: FE Credit phone number
- HD Saison
- Home Credit
Personal Loan Limitations
The amount a bank or financial institution is willing to lend depends on various factors such as employment duration, employer, and residential information of the customer. It could range up to 10 - 15 times the monthly income, but should not exceed 500 million dong.
Requirements for Applying for a Personal Loan
* Criteria
- Being a Vietnamese citizen aged between 18 and 60, with either permanent or temporary residence registered at the lending bank.
- Having a steady and fixed monthly income ranging from 4.5 to 5 million dong or possibly higher.
- No history of bad debts.
* Procedures
- Identity card/citizen ID/passport
- Loan request form (as per the template provided by your chosen bank)
- Household registration book or temporary residence registration book KT3
- Income certification if you are applying for a salary-based loan.
II. Installment Cash Loans
1. Understanding Installment Loans
Installment loans involve borrowing money without the need for collateral, with fixed monthly payments that cover both principal and interest. The interest is calculated based on the remaining balance, and the repayment period is typically monthly.
2. What are Monthly Installment Loans?
Monthly installment loans are unsecured loans, not requiring any collateral. Customers seeking capital must repay their debt to banks or financial institutions through monthly installments. Approval for this type of loan depends on one's creditworthiness, determining the loan limit and duration.
3. Interest Rates for Installment Cash Loans
Interest rates for installment cash loans range from about 0.8% per month, with borrowing limits of up to a maximum of 500 million Vietnamese dong. This form of lending is based on salary, credit cards, life insurance, and existing credit contracts.
4. Institutions, Banks Offering Installment Cash Loans
The demand for consumer loans among the public is increasing, and many people are choosing installment loans. To ease financial pressure and support borrowers, many banks and organizations offer installment cash loan services such as:
- Techcombank
- VPBank
- HD Saison
- FE Credit
- Prudential Finance
- Home Credit
5. Procedures for Applying for Installment Loans
- ID card
- Household registration book
- Citizen identification card
- Recent 3-month electricity and water bills if applying based on utility bills
- Insurance contract if applying based on life insurance
- Employment contract and payroll statement if applying based on salary
- Business registration certificate if applying based on business license
- Photo of credit card if applying based on credit card
Through this article, readers can easily understand the common forms of cash loans in Vietnam. If you are in need of capital, consider choosing the suitable form and bank. Additionally, borrowing based on salary is quite common, with many banks offering support such as Vietcombank or VPBank. You can refer to these options for selection.
