Six myths about microfinance organizations.

Microfinance is one of the most discussed services in lending. However, citizens often discusses not so many facts as various myths about microfinance organizations.

A large number of companies in the lending market work quite honestly and act in accordance with the legislation, but there are some organizations that are trying to bypass the law and make a profit unfair.

That is why citizens formed a negative opinion on the market for instantly lending, after which the myths appear.

In such myths believe those citizens who do not pay sufficient time when concluding the agreement to read the contract. They believe that the MFIs work some scammers who are deceiving ordinary people.

A microfinance organization, which operates legally, will always be able to inform you the full overpayment before the conclusion of the loan agreement. The borrower always knows about what and how much he overpays. In addition, licensing information can always be found in public domain on the organization’s website.

A large number of organizations specialize in emergency loans with a term and sum within one wage. However, some organizations are ready to provide a loan for a year and even more.

The most common myth among Citizens about MFIs is too high the cost of services.

From July 1, 2019, the relevant changes were made to Federal Law No. 554, which stated that the maximum loan rate could not exceed 1% per day, or 365% per year, the maximum amount of debt was also reduced to two multiple size in relation to To the initial loan.

Opponents of MFIs tell such stories that if you take a debt of 10 thousand rubles and do not give up on time, then the company can take the car or even an apartment. These stories are not true.

Losing property can be lost only if it was issued on bail. And how we know the procedure of pledge passes through the notary, so it is impossible to lay an apartment or a car on an online application.

Employees of collector companies often cross the verge of morality, but this does not apply to MFIs — this is a completely different organization.

Many believe that to take money to MFIs is the latest step in the abyss of lack of money. Most citizens use MFIs as a convenient system for unexpected spending.

In such a situation, everyone may be, and take money for a while — it is absolutely normal.

Citizens have long developed such an opinion that microfinance organizations give money to all whoever in the next. However, this is not the case.

Recently, microfinance organizations have all with great enthusiasm to enter the lending market. Yes, their interest rates are much higher than in financial institutions.

However, they also have the risks of non-return, and carry out their activities exclusively in small transactions. Each citizen may have a difficult life situation, and the MFIs will help them in this. They are the same part of the financial system as large banks.

We hope that the article was useful for you! Do not give up myths by the meaning, because they are invented by people who often do not even know how to eat.