Microfinance is a comprehensive consumer loan with individuals or enterprises as the core. The loan amount is generally more than 1 1,000 yuan and less than 200,000 yuan. Its basic characteristics are small amount, no guarantee, no mortgage and serving the poor. Microfinance can be provided by formal financial institutions and specialized microfinance institutions or organizations.
Microfinance is generally a short-term loan with a short term, and the loan term can be freely chosen. It is mainly for office workers, self-employed individuals and enterprises, and it is an unsecured and unsecured credit loan. The amount of personal micro-loans provided to office workers generally ranges from 1000-5000 yuan, most of which do not need mortgage, but the credit and information are strictly reviewed.
Example of loan: Take pat loan as an example, the loan is 50,000 yuan, the loan term is 1 year, the monthly interest rate is 0.83% (the annual interest rate is about 10%), the repayment method is equal principal and interest, and the loan interest is 2,749 yuan. But every loan has to pay a certain loan fee and value-added service fee. Assuming that the loan fee is charged at 5% of the principal and the value-added service fee is charged at 10% of the principal for the first time, the total loan interest is: 2749+50000 * 5% (loan fee) +50000 * 10% (loan fee).
If a small loan chooses to borrow from a bank, and it is overdue, your personal credit report will be tarnished, and it will be more difficult to apply for credit cards and loans in the future. Even small loan companies are not included in the credit report, and there is a "blacklist" system in the circle. If a company does not pay back, it will be difficult to approve other loans.
If the loan is not repaid, the first thing you encounter is a high penalty interest. Some financial institutions need you to pay liquidated damages on the basis of penalty interest. These expenses add up to a lot of money.