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Don’t be fooled by personal loan scams

Finance & Money

Posted on Tuesday, June 4, 2019

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Because budgeting is hard, at some point most people need a little extra financial help, whether it’s to cover unexpected medical costs or to visit granny during the holidays.

Unfortunately, criminals know this and are taking advantage by running personal loan scams. Make sure you know what’s what when you take out a personal loan so you don’t become a victim.

Budget Insurance personal loans

When you take out a personal loan online with us, we follow some simple but strict procedures to make sure you’re protected. Here’s how it works:

You can take out an amount of between R1 000 and R250 000 and pay it back over a period of between 12 and 60 months. Your monthly repayments will be fixed and we’ll tell you straight away how much you’ll pay back every month. To apply, you need to fulfil the following criteria:

  • Be over 18 years old
  • Have a valid South African ID or driver’s licence
  • Have a bank account so we can pay you the loan via EFT
  • Be employed, earn at least R2 000 per month, and provide proof of income

Now that you know what it takes to get a personal loan with us, you can more easily tell the difference between the real deal and a scammer.

Personal loan scams

There are some common warning signs you can watch out for with loan scams, such as:

  • Asking you to pay administration fees upfront
  • Using a fake logo from a real company. This may look blurry, squashed, or stretched – it won’t look like it should
  • Sending you an email from a Gmail, Yahoo, or other generic address, rather than a professional company address
  • Offering to loan you more than R250 000
  • Using a bank account in an individual’s name rather than a company’s name
  • Requesting a face-to-face interview
  • Using bad grammar and spelling in their communications
  • Having multiple contact numbers. At Budget, there’s only one contact number for our personal loans department: 0861 877 774

Protecting yourself

Sometimes, a fake website or letterhead can look completely real. Before signing up for a personal loan, take a few extra precautions to make sure you’re dealing with a reputable company.

  • Check if the company is registered with the Office of the National Credit Regulator. Anyone offering personal loans must be a licenced financial service provider by law.
  • Don’t make any advance payments before receiving your loan. You should only be paying it back in monthly instalments
  • We know how long and boring terms and conditions can seem, but it’s still important to read them; it’s here that scammers often catch out unsuspecting victims
  • Call the company to find out if it’s a real operation. With Budget, you can call us on 0861 877 774 to confirm we are who we say we are