Online loans are the trend. According to the German Bankers Association, in 2015, already a quarter of the loan agreements were concluded on the Internet.
Reason enough for Geofoundation to take a closer look at the offers on the internet. The conclusion is almost entirely positive.
Significantly more favorable conditions for online loans than in the branch
Compared to the previous year, the proportion of online loans has risen by five percent. Consumers should probably have convinced the more favorable conditions compared to the offers of the branch banks, according to the assessment of the consumer protection organization. Some of the interest rates differ by more than three percentage points. And as determined by Geofoundation, the online providers generally keep their interest promises. Deviations are possible, however, if banks grant credits depending on their credit rating. In the test, however, these were in favor of the borrower: Due to good credit rating, the subjects were in some cases loan offers with a cheaper interest rate than stated on the website of the provider.
Geofoundation certifies good user guidance – with one exception
Also on the application for the online loans, the goods testers had little to suspend. Twenty of the 22 tested banks guide their customers straightforwardly and clearly through the loan application and provide them with all relevant information. However, one bank failed: Agibank provided information to the private credit credit agency, which had a negative effect on the Applicant’s private credit score. A credit check with the private credit is quite common, as well as learns the credit bureau from the bank, when a consumer at a bank conditions for a loan request. However, this so-called “request credit terms” has no influence on the credit rating of the consumer. However, Agibank sent another request to the credit agency, which had a negative impact on the creditworthiness of the customer.
Keep your eyes peeled for the remaining debt insurance
Some providers of online loans also had to take criticism because they tried to persuade the applicant to take out residual debt insurance through presettings. Such insurance may make sense for higher loan amounts, but for smaller loans it is often not necessary. Ultimately, the conclusion of such insurance should be a deliberate decision of the customer. For Agibank, IKD, Parabank and Camibank, however, the policy was already automatically selected in the application, so there is a possibility that borrowers may close it by mistake. The General Public Bank even made unsolicited offers with residual debt insurance.