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NBS warning to financial consumers about loan offers on the internet

24. 04. 2020 | Information for the public

Národná banka Slovenska (NBS) draws the attention of financial consumers to various loan offers that they may encounter on internet advertising portals, social networks or other websites these days. Many of these offers promise financial consumers that:

  • they will solve all their financial problems in these difficult times;
  • they will lend them money even if other providers in the financial market would not do so;
  • the creditor will not examine their income.

If such loan offers appear interesting, Národná banka Slovenska advises financial consumers to learn more about the offer and answer the following three basic questions:

1. Who is offering the loan?

If you are not able to answer this question at first glance, you would be wise to take care. In Slovakia, only companies (creditors) with permission granted by Národná banka Slovenska may provide loans to financial consumers. If you are not sure about who is offering the loan, look for the name of the company and check on the website whether it is entitled to provide loans or not. Nevertheless, it should be noted that Národná banka Slovenska does not supervise loans provided on a mutual basis by natural persons and non-entrepreneurs (known as peer to peer lending).

2. Can they fulfil what they promise in the offer?

If it is stated in the loan offer that the loan will be provided under all circumstances without examining your income and your credit history, you should beware. Creditors offering or providing loans based on permission granted by Národná banka Slovenska have a legal obligation not to conclude a contract without assessing your ability to repay the loan, considering your income.

3. Is the loan offer beneficial for me?

In order to answer this question correctly, you need to know the specific details of the loan offer so that you can compare it with other offers on the market and decide whether you need a loan and if so, what kind of loan is the most suitable for you. Creditors providing or offering loans are obliged to provide you with detailed information concerning the required loan before concluding the contract (e.g. the APRC, the conditions for drawing the loan, etc.). For example, if the loan offer requires you to pay a fee before the loan is granted, be careful as it may be a scam.

If you answer “I don’t know” or “no” to at least one of the questions when considering a particular on-line loan offer, it means that you should not rush in and you should think carefully about the subject you would be concluding the contract with.