Are Online Loans More Competitive Than Bank Loans?

Many people ask this question when they are applying for an online loan. The most basic answer to the question is – online loans competency over bank loans. In other words, online loans are more competitive since online lenders have to compete with offline lenders, not just online lenders. Here is another enlightening yet straightforward answer to the same question.

First, let us explain the online loans competency over bank loans. Banks, unlike online loan providers, actually serve as intermediaries between borrowers and lenders. They usually provide online quotes in order for the borrower to choose the online loan that best suits his/her needs and requirements. This means that the online quotes provided by the bank to the online loan provider reflect the bank’s own policies regarding online loans.

When online loans are competent over bank loans, what does this mean to the online loan provider? 

Simply put, the online loans provider has to be even more competitive in order to survive the cutthroat competition in the online money lending market. That means that online loans providers are constantly trying to find ways to differentiate themselves from their online competitors.

How do online loans show competency over bank loans?

One way to distinguish yourself from the competition is to offer better online loans competency. To illustrate, say you are an online lender, and one of your competitors has the following online quotes: A-prime online loan with a $1000 credit limit; B-prime online loan with a $5000 credit limit; C-prime online loan with a $2500 credit limit; D online loan with a $1500 credit limit. What do you think your online lender should do in order to attract more customers and increase the chances of getting new clients and convincing existing customers to re-apply for online loans with your online lender? Obviously, the online lender will have to offer more attractive online loans competency levels in order to retain existing customers and lure new customers. In other words, if you want to increase the online loans competency of your online lender, you should provide better service to your customers.

This is perhaps easier said than done. For starters, it may require a new online policy and online format in order to accommodate the changing needs of the customers. Secondly, you might need to tweak your online lender software to incorporate some features that were previously available only to bank branches. In addition, some online lenders tend to outsource some of their loan processing tasks to reduce the workload for online loan applicants.

How to identify the online loans competency of your online lender?

How do you know that the online application form is easy to complete and that the online money lending process is quick and hassle-free? First and foremost, you should follow the online lending guidelines published by the financial institutions like banks, credit unions and other such financial institutions which can be found on the website of the online lender. Click here to find the information provided on the website that will give you a good idea of their online loans competency.

If the online website does not provide you with sufficient information about the loans online processing, you can directly approach the loan processing centre of the online lender. You may also find the answers to your questions on the website of the online lender. In addition, you can check the FAQs section of the website to get the answers to your questions pertaining to the various online loans that the online financial institution offers. Of course, the online banking services offered by these financial institutions will vary from one online lender to another. So it would be beneficial for you to conduct comprehensive research before zeroing in on a specific online lender for online loans.

Finally, when it comes to the charges of the online loans offered by the different online lenders, there are a few factors which are beyond your control. For example, the APR of the online loans will depend on the individual credit score and the repayment capacity of the borrower. However, you can get your consolidated APR for various loan plans at the Annual Percentage Rate (APR) quoted on the website of the particular financial institution. So make sure that you do not zero down on the specific online loans more competitively based on the APRs quoted on the websites only. You can also compare the costs of different online loans and select the most affordable deal.