The Trap of taking loans, from loan apps the mistake most young people do.

[Olotu20]

As technology and access to the Internet has revolutionized the world. Allot of things has become easier to have access to when compared to some years back. One thing that is now common these days is easy access to loans via online loan apps which provides Monterey servers to people, infact having access to a loan now especially in my country is less than an hour.

Due to this easy access to money due to these loans apps, people have been locked up in a dept circle. This is because most of these loans apps are structured in a way that is disadvantageous to the borrower. This is so because these loan apps have a high interest rate which they add to these loans, plus a short period of payment. With this when ever someone fails to pay back their loan in the due date, extra charges applies which increases the the amount of money money becomes a financial burden on the long run.

With this if the borrower doesn't have money to pay, one is forced again to collect loan from another loan apps to offset the previous one, this circle repeats and become a financial prison that has lock up many. One thing that I have seen with these loans apps is their easy access to loan, unlike the conventional banking systems which requires a collateral when ever they are giving out loans. These loans apps doesn't require collateral what is needed is just the one number of two to three persons which they can call when the person defaults to pay.

This has made many young people to see loans apps as an easy way of getting money, not realizing that they are actually trapping their financial freedom and progress. I want to summarize by saying that taking loans is not the remedy to our financial problems, but good financial habits such as saving and investing is the key to financial prosperity and borrow when it is only necessary or emergency situation.

[Sanitough]

Taking loans from unreliable loan apps have unreasonable surging high interest so I don't suggest them as a good option. But taking loan remains a wise strategy, especially if you plan to put it up on a smart investment like bitcoin or gold, or build up a business that you are highly sure that the business will click and profit because you know well how to make it work.

However, there are factors to consider before taking a loan, like one should only have a small interest surge, borrowing on the amount you can afford to pay, most especially only take a loan when you have a reliable income to pay, and not because you rely on the future profits of your investment when you don't even hold the guarantee if your investment will make it long enough.

[Pi-network314159]

Well despite the loan app is now seen as a treath to humanity, because of the high interest rate and so on, don't also forget that this loan app has helped to reduce the rate of stress looking for loan when there is an emergency. In my own personal point of view, there is nothing wrong with this loan company that offers help, the thing is that you are paying for the conviniecy. And another thing is that the loan is not by force, its a person decision wether to accept or not.

[abhiseshakana]

In my country online loans are equated with online gambling, and nowdays on emergency condition because many people trapped, depressed, even to the point of suicide. Online loan applications, especially illegal ones, besides charging very high interest (35% in 1 week) they also use strong threats and spreading debtor data to some contacts on the phone.

I think this confition happened due to fintech deliberately erase all friction for people to get loan, the parctice actually quite same with online shopping application. For getting loan no need to go to the bank, no neef review our checklist status at central bank, no need waiting several days, no need to submit hardcopy document and no need direct survey to our house, they swap out all the barrier which make we take impulsive decisions. I think fintech work like do a magic, we can get money now without any consideration of long term consequences with principle as long as i am happy now.

Only government can combat this dangerous and disturbing business.

[Asuspawer09]

These loan application was also a huge thing in my country probably if you do social media there will be a bunch of advertisements of this loan applications there are so many loan applications that is already popular in my country where you could do small loans very easily. I was also tempted by this loan applications since they could offer a low loans around 400$ i think very easily, as long as you have an IDs on you could easily apply depending maybe on your credit score they are going to offer possible loan amounts. But there was a huge catch on interest because the interest was just very high, too high for the amount maybe around 10-15% of interest on your small loans, but it was also very limited since they are the one that is offering you don't really have much of a choice, unless maybe your a regular your already have increase you credit limit.

This wasn't, in my opinion, a good credit because of the high interest. Traditional banks and credit cards have lower interest, plus you will get a good credit score as well, so I would just stick to the traditional one not to mention the promos and cashbacks that you might get if you are spending it right. I did utilize one of my cards and get a cash voucher plus free pizza when I did hit a certain amount.

[LogitechMouse]

In my country online loans are equated with online gambling, and nowdays on emergency condition because many people trapped, depressed, even to the point of suicide. Online loan applications, especially illegal ones, besides charging very high interest (35% in 1 week) they also use strong threats and spreading debtor data to some contacts on the phone.
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Only government can combat this dangerous and disturbing business.

This is also the problem in my country. They're receiving death threats, or threats that could traumatize them for a long amount of time.

I have no experience in these online loan applications because it didn't come to a point where I need to do it. I've seen my relatives though that have done it, but they're good payers so they paid it immediately and didn't do it ever again because of the ridiculously high interest, and correct me, but I think these online loan applications really have high monthly or weekly interest, and that's what makes these debtors having a hard time to pay it. Like in your country, there are some people here as well who got depressed, traumatized and stressed because of how these people are talking to them, and I feel bad for them, but at the same time, it's their fault as well that it came to a point where they need to ask a loan on these kinds of applications.

As much as we are hearing negative things about these applications, we can't deny the fact as well that there are legit ones that aren't doing what the other ones are doing. As for the government combatting this, they are, and I've seen news here where the authorities are taking down these illegal online loan companies. There are still legit ones though that are registered, but there are also illegal as well that are operating in silent.

[Darker45]

Loans can only be good if the money is used for something productive. Unfortunately here in my country, most are taking loans for the sake of things that aren't really important. And, as you've observed, it's driven by easy access.

Here in my country, mobile banking can be accessed by anybody who has a phone. There are several mobile banking apps here, all of which offer users the opportunity to borrow money.

But not only this, lending businesses have also grown in numbers. So, even those who don't have phones could easily buy stuff they can't otherwise afford. Young students could easily buy a trending expensive pair of sneakers even if they don't have the money because of these lending companies.

[PostQuantumBTC]

Taking loan can be good, but it should be for business and business alone in a way that you would have earned more from the business before the loan time expired. But the way loan is today, it is very bad, students and people that are not working but having little bank inflow and outflow can also be able to borrow loan. In the past when people of this categories did not have access to this loan, they were living good. The problem there also is that if you pay back the loan, they will increase your limit. It has affected me before but I stopped taking the loan when I knew that I am losing money to the loan companies.

[TastyChillySauce00]

These loan apps designed to accept borrower with low credit score, they added fees and higher interest due to higher risk of bad debt and defaulted loan. Therefore are designed to be predatory and extracting as much as profit as possible at the expense of borrower.
It's a trap for people who aren't patient enough to borrow from bank with better interest.

When you installed their apps, you're already jumping in into their trap. Their interest is high to keep you paying and restructure because they don't have any intention to let you repaid your debt fully and broke free from it easily.

[Free Market Capitalist]

As technology and access to the Internet has revolutionized the world. Allot of things has become easier to have access to when compared to some years back. One thing that is now common these days is easy access to loans via online loan apps which provides Monterey servers to people, infact having access to a loan now especially in my country is less than an hour.

Due to this easy access to money due to these loans apps, people have been locked up in a dept circle. This is because most of these loans apps are structured in a way that is disadvantageous to the borrower. This is so because these loan apps have a high interest rate which they add to these loans, plus a short period of payment. With this when ever someone fails to pay back their loan in the due date, extra charges applies which increases the the amount of money money becomes a financial burden on the long run.

With this if the borrower doesn't have money to pay, one is forced again to collect loan from another loan apps to offset the previous one...

I was wondering which country you’re from, since things usually work a little differently in industrialized countries, and I see you are from Nigeria. In countries with high GDP you could only do that, if at all, with very small loans because, generally speaking, all your loans—if they exceed a certain amount—can be tracked by a central agency. So taking out more and more loans to pay off the previous ones doesn’t usually work. They become unavailable very quickly once you get into debt and can’t make the payments.

But in general, access to quick—or even instant—loans encourages compulsive behavior, especially with gambling, and can lead to ruin, leaving those who misuse them in debt for a long time.

[Hypnotizer]

Taking loan can be good, but it should be for business and business alone in a way that you would have earned more from the business before the loan time expired.

Well in the case of these loan Apps I don’t think some are designed to give you loans to start a business, most of them are designed to give loans to people in emergency situations and that’s why the repayment period is usually low, just around 3-6 months and some are even in weeks.

So for someone that wants to do business with loan, the best place to collect loans are still the banks that will give you an amount based on your collateral because most of these loan apps don’t give a first time user of their app a huge amount of loan.

But the way loan is today, it is very bad, students and people that are not working but having little bank inflow and outflow can also be able to borrow loan. In the past when people of this categories did not have access to this loan, they were living good. The problem there also is that if you pay back the loan, they will increase your limit. It has affected me before but I stopped taking the loan when I knew that I am losing money to the loan companies.

Yes many people nowadays take unnecessary loans and it’s very bad especially for people who take loans to spend them on baseless things and when the deadline for repayment comes most of them are unable to pay back.

[Odusko]

A loan is generally a bad financial habit for both individuals and governments, and countries that depend on loans have ruined their economies due to the debt burdens and high-interest rates on loan repayment.
On an individual level, most of the loan apps are unlicensed and unregulated here in my country. They even go as far as charging interest on their interest for loan defaulters, meaning they have an unspecified interest right that is designed to suck the borrowers' finances, which is the reason why most of the loan borrowers are not able to make repayment. The government have banned most of those loan apps. Still, people keep running to them for reasons I can imagine; their bad interest rates should be a red flag for borrowers and should not allow the flexibility of taking a loan to be a bait to get trapped in their scams.

[Olotu20]

A loan is generally a bad financial habit for both individuals and governments, and countries that depend on loans have ruined their economies due to the debt burdens and high-interest rates on loan repayment.
On an individual level, most of the loan apps are unlicensed and unregulated here in my country. They even go as far as charging interest on their interest for loan defaulters, meaning they have an unspecified interest right that is designed to suck the borrowers' finances, which is the reason why most of the loan borrowers are not able to make repayment. The government have banned most of those loan apps. Still, people keep running to them for reasons I can imagine; their bad interest rates should be a red flag for borrowers and should not allow the flexibility of taking a loan to be a bait to get trapped in their scams.

That is completely true especially for countries,too many developing countries has also been trapped by loans that they have taken from some of these developed countries and the world Bank. They have been hit by the burden of paying back these loans, as individuals people should not be in the habit of collecting loans that are not necessary especially these online loans which has a high interest rate.

[passwordnow]

This has made many young people to see loans apps as an easy way of getting money, not realizing that they are actually trapping their financial freedom and progress.

They have the wrong mindset. It's not their money per se and why think that they should take money from the loan apps? They're oblivious to the effect of it. Getting approved is easy but paying that keeps them away from freedom. It's simple if they'll try to understand this thing, if it's not their money then it is not theirs. I guess that the social media impacted all of these young people which they think they have to buy everything that's on the trend they new. Soon, they'll realize that the real freedom is through having no debts, you'll have no master since borrowers are considered as slaves to the loaners.

[Majestic-milf]

 I see loan apps like gambling sites. The moment you start, if you don't have control you'd keep going, just like an addict looking for a fix. Loan apps just like every business person seeking patronage, are always praying that their customers remain perpetually in need of money and when you settle your debt, they will bring up increased loan limits so you can keep being in their grip.
 We all need financial assistance somehow and I'm not going to deny that it does not help, the thing there is if you don't have control, you'd remain in debt for a long time.

[sidrabtc]

I see loan apps like gambling sites. The moment you start, if you don't have control you'd keep going, just like an addict looking for a fix. Loan apps just like every business person seeking patronage, are always praying that their customers remain perpetually in need of money and when you settle your debt, they will bring up increased loan limits so you can keep being in their grip.
 We all need financial assistance somehow and I'm not going to deny that it does not help, the thing there is if you don't have control, you'd remain in debt for a long time.

Here I completely agree with you about this because I have personal experience with this. My elder brother started, but his end was terrible because he was just like addicted to something, always having a mobile in his hands and talking with someone about paying or taking.

This was not a good time for our family, but we did hard work and brought him out of this curse, but still these are the worst memories of my life because I really never want anyone to have a problem like this and face things like these few apps have the worst way of dealing, which increases problems for people to settle things, but they always increase the limit quickly. This is another big charm.

[noorman0]

In my country, online loan ads are poorly filtered, for example, without content tailored to age.
Furthermore, new illegal loan apps appear every week, offering offers via random text messages. People of all ages are exposed to loan offers, regardless of their financial background. Worse yet, they offer very easy loan applications, which has led to numerous cases of data misuse in recent years.

[Cointxz]

A loan is generally a bad financial habit for both individuals and governments, and countries that depend on loans have ruined their economies due to the debt burdens and high-interest rates on loan repayment.

Loan is not “generally bad financial habit”.

It was meant to give temporary capital to someone that needs money immediately when their source of income is fixed on specific date.

As a business owner, this is useful to me since I can acquire temporary funds immediately that I use to purchase my business materials needed to my production. The E-commerce that we use usually have 2 weeks delay of fund released to all our orders profit so I have no choice since I’m a bit short of capital that time. I don’t use loan apps but I avail quick loan to Darkstar multiple times back then with a very reasonable interest.

Loan is not inherently bad. It’s the way how people use it.

[MainIbem]

Taking loans is not a bad idea, to some people it can serve as a leverage to improve their business but it becomes bad when someone has no means of paying back, and that’s when you see them going in circles of debt like you said. Well some loan apps are too complicated to deal with, like why charge huge interest rate with short payment period? That's so unfair and people should avoid those kind of platforms, some even include hidden charges, very unfair. Also, people should be wise when dealing with stuffs like that, one should take unnecessary loans to sponsor their lifestyles.

[maydna]

People also finds an easy access to loan online in an online store. Here, people can applicating request for loan online easily and not takes too long to pay the goods. But they should pay the interest plus their loan daily, weekly, or monthly according the deal. But other apps also showing the loan app while they access the app so that tempting people to get the money by the easy way.

When the borrower can't pay the loan, the debt collectors will comes to their house and asking with treating. That makes borrower requesting for another loan from other loan apps to pay while they still need to repay the borrowing money from the last loan apps. That looks a circle that never end unless they can pay all loans which will becomes too big. Borrowing money can be done but only you have urgent situation and you can pay the money. If you can't do, it is better you search for other ways.