Payday loan in Belgium

Payday loan in Belgium

Belgium is no doubt a beautiful country that plays host to so many people from across the world. The beauty of Brussels, the controversial legacy of King Leopold and many more are something to look up to. Amidst these exciting tales of Belgium, becoming cash strapped or simply overrunning your budget is not a strange thing in the country. It is possible that on a normal month, you may end up spending more than planned, all for good reason. 

As in any developed country, individual people will rarely come through to lend you money. There is this general idea that borrowing is a preserve of financial institutions which then forces you to turn to them when in financial need. Look here, sometimes it feels out of place to approach a friend to lend you money in Belgium, especially if the money runs into thousands. It is at this point that payday loans become something worth carefully considering. 

Desperately in need of money in Belgium? Payday loan may bail you out

If you are desperately short on cash, for example you can’t pay for your rent or settle some monthly subscriptions in Belgium, normally going for a payday loan will cross your mind. Actually, loans are the best saviours in situations when every source of income has hit a dead end but demands seem pressing at every turn.

In such a situation when money is needed, you go to a payday lender and apply for a loan to help you sort out whichever needs are there. So, payday loans are short-term loans  that should be typically repaid within two – three weeks. All you as an applicant need to do is provide your debit card number or write a post-dated check and receive your speculated cash almost the same day.

In Belgium for example payday loans are very effective because once you apply for it, the lenders only wait for the date on the check to roll around then they cash your check to pay the loan in full. A relatively small amount of money lent at a high rate of interest but only on the agreement that it will be repaid when you receive your next wage. Low-income consumers are therefore urged to avoid payday loans.

Are payday loans legal in Belgium?

Payday loans just like any other lenders in Belgium are legal. Actually, as  in all the 27 European Union ( EU ) countries, payday lenders in Belgium are legal entities. It remains the responsibility of the lender to comply with required financial regulations when establishing a payday lending facility in Belgium, So as a borrower, this is not your problem. The lender-borrower agreement will basically be between you and the lender, full stop. 

The lenders will as a necessity do a thorough background check on you and find out your credit worthiness before advancing a loan to you.. Anybody listed in the Belgium Central Credit Register can be sure not to qualify for any loan. With a quick check, the lenders will always know your creditworthiness even before considering how much you are applying for. 

The reason why payday loan lenders get so strict with lending is that some people violate their state laws for example those who borrow but do not return the cash in time or take big loans which they end up not paying. Settling for a payday loan in Belgium therefore means that you have done your mathematics and agreed with their terms of payment. 

Popular payday loan lenders in Belgium

When making the decision to go for a payday loan, you are already in a desperate situation and only need a legitimate lender. Nobody wants to engage in another circus of trial and error when trying to borrow a payday loan in Belgium, As you may be aware, payday loans can always be in the tunes of thousands and so people want to not only be sure that the money will actually hit their bank account once processed as well as an assurance that nobody is snooping the entire process. 

Something critical when selecting a payday lender is the length of time they take to process your application. Understandably, you resort to this kind of loan arrangement because you typically need the money now. Any delays in the entire process therefore becomes a great setback. 

Taking all the typical pain points that a payday loan applicant may wish to avoid, here is a list of the possible lenders for you. 

  • Credit point
  • Cetelem
  • Bpost Bank
  • Credafin
  • Astuce Credit
  • Santander
  • KBC Bank
  • Cofidis Belgium

This is why payday lenders in Belgium will need your bank details

Giving your banking details to someone is something most people don’t take lightly because some of these people may even be scammers. But in Belgium, before you are guaranteed that payday loan, there are a number of things they will ask from you one of them being your routing number and your account number. Payday lenders ask for these for the following reasons;

  1. For verification of your account. An operational bank account is a requirement for you to qualify for these payday loans. This is the simplest and easiest way to verify if you are eligible.
  2. Deposit fund. Most of the funds are usually sent directly to your account using an ACH transfer. This is only possible when you avail your bank account. Especially the online payday lenders who cannot reach out to you every time in person.
  3. To check your ability to pay. Most of the legitimate lenders always want to make sure you can afford to pay. Your bank credentials make it fast to access your bank statements. They will be able to see if your earnings tally with the loan you are applying for.
  4. Collection of the payment. Your bank account information makes it very easy for lenders to set up automatic repayments if the day is due. It also allows you to collect and make payments at the comfort of your room as you don’t have to walk to the bank to make transactions.

Things to consider before taking a payday loan in Belgium

People sometimes enter into borrowing even when they can avoid it. Bad financial habits may easily make someone borrow simply because they qualify. However, taking a payday loan comes with sometimes high interest rates which then necessitate careful thinking. 

The only time one should make a decision to take these short-term loans in Belgium or anywhere else is if the financial situation is so dire and urgent that it’s the only option left. As much as they are our saviours, they also come with their own challenges. For example, instalment loans, auto title loans and even the payday loans which come with very high rates and fees which can trap you in a cycle of debt.

In many cases, most borrowers find themselves taking out a second or third loan because they could not pay back the first one on time. Therefore, before opting for these short-term loans, one should consider the following alternatives;

Consider the possibility of repayment extensions

Before you settle on the short-term loan in Belgium, it is very important to talk to your bill providers. Talk about a longer payment plan or extension on your due date if you are behind on payment. 

It’s prudent for you as a borrower to choose a lending option that suits you to avoid inconvenience within the payment period. Again, if you can pay it within a short period then it is still okay.

Forget about payday loan in Belgium and find alternatives

Belgium being a social democracy  is designed in such a way to offer liveable conditions to all. Apart from the robust social security system in Belgium, there are a few organizations that come in to improve the wellbeing of people when in need.

Its understandable that even with a regular income, there is possibly a month when things go south and your salary falls short of meeting all you needs. In such cases, you can reach out to organizations that may give out food, clothes and sometimes shopping vouchers. These organizations are non governmental as well as government sponsored. 

Do not feel embarrassed to approach charities and non-profits for free assistance. Yes, it may seem awkward but remember nobody knows your need until you put it out there. Typically, these organizations will not shy away from helping with free financial services, food, utilities and rent.