A Comparison between a Licensed Money Lender and Banks

Life is full of hard times and challenges, and you need to prepare ahead of time for this. Sudden financial needs like unexpected health emergencies or any other issues may require a certain amount. Many people prefer going to banks in such tough economic times, but the fact is that banks will charge you higher interest rates than a licensed money lender.

In such challenging times, you may require the services of a professional, trustworthy, and licensed money lender in KL, Malaysia.

A personal loan Malaysia from a licensed money lender can be a powerful tool as they approve fast cash flow with exceptional financial services to resolve issues.

Banks and money lenders have their pros and cons, and in this article, we will explain them in detail, so you can make a wise decision if you ever need a personal loan.

What are the Common Things between Banks and a Licensed Money Lender?

Life can take a turn at any time. Everyone in this world needs to take a loan once at some point in their life. Here are a few things that a licensed money lender and banks have in common.

  • They help lend money to people in different conditions.
  • They need an interest rate on paying loans.
  • They will assess your creditworthiness to make sure that you have a stable income and that you will be able to pay back the loan.
  • They will require documents like payslips, identity proof, proof of address, insurance, utility bills, etc.
  • They will browse through your credit score as it is a direct measure of how well you manage the credit you already have.

Getting a Personal Loan Malaysia from a Licensed Money Lender 

Money lenders usually advance their funds. They are comparatively less strict than banks because their only concern and focus are giving personal loans. They may get instant and quick loan approvals to facilitate people in getting fast cash in times of adversity.

Getting a Personal Loan Malaysia from a Bank

When getting a personal loan from a bank, the process can be quite different. The majority of people opt for this option because of its reliability and trust. Banks usually lend money out of the deposits they have accepted from their customers. They can provide high amounts for much longer terms. But the thing is that the waiting period is quite long and tiring. You need to wait a little longer to get your funds.

Which is the Best Option? 

You could require a personal loan Malaysia at any point in time as life is entirely unpredictable. Whatever is the reason behind borrowing money; there are various financing options available in the market. If you need a big loan and can also wait for a little, banks are a good choice. But if you are in need of a small loan but you need it right away, then banks are a big no. You surely need to consult a licensed money lender for this.

Be Aware of Loan Sharks for a Long 

When it comes to borrowing money, you need to be extra vigilant about scams. It is highly preferable to do some research beforehand so that everything goes smoothly in your favour.

The market is flooded with loan sharks for a long. These are the unlicensed money lenders who operate illegally by charging higher interest rates. And then use unfair means like violence to collect debts.

There are sometimes when it is pretty unclear if a moneylender is licensed or not. Take your time out and find the licensed money lender; it is worth your time.

How to Stay Safe from Loan Scams 

It is necessary to consider a few things before borrowing money from any money lender. For personal loan Malaysia you can visit the website of the Ministry of Urban Wellbeing, Housing, and Local Government. This website allows you to check the legitimacy of a money lender.

Loan sharks may also ask you for your payment details or personal information. So, it is advisable to check their background, reputation, reviews, etc., to avoid any fraud.