VERY IMPORTANT! These are the characteristics of illegal and legal borrowing

As previously discussed, you must know important things before lending money to other people. Well, it's the same with money borrowers,you need to know first the risks of borrowing money either with other people or through online money borrowing applications.

Especially now that there are so many cases of people trapped in illegal online loan applications, where they will be charged high interest rates and receive threats from the collection party. In addition, the borrower's relatives usually receive threats from the collector.

Therefore, before you borrow money in an online loan application, you must first know the difference between an illegal loan and a legal loan. Well, for more details, you can see the following explanation, yes!

Features of Illegal Online Loans

For those of you who want to build or run an online business idea by borrowing money in the loan application, you must first know the characteristics of the following illegal online loans!

1.Sending Offers via SMS

The first characteristic of illegal borrowing is that illegal online loans often make offers via SMS or chat applications such as What Sapp. They also send offers many times or spam.

They even send offers with fantastic loans without having to provide guarantees and the disbursement of funds is also very easy. Because they will ask for access to all personal data on your smartphone.

So it's not surprising that victims and their closest relatives often receive terror threats, feel intimidated, and get harassed by the application's employees.

2. Very High Administration Fee

The next characteristic of illegal borrowing is very high administrative costs. As we know, every application service or any service will have an administration fee charged. Well, usually to trick the victim, the loan will charge a very high administrative fee.

Unmitigated fees or administrative fees charged can reach 40% of the loan amount you lend. If you borrow Rup. 1,000,000, - then you will be charged Rup. 400,000, - meaning you only get a loan of Rup. 600,000.

3.Fines or Very High Interest Rates

The next characteristics of illegal borrowing are fines or very high interest rates. Already the fee charged is very large, the interest to be charged is also very large, which can reach 1% – 4%.

This of course is very detrimental to you. Because when you are late paying the interest rate charged will continue to multiply. That's why it's not surprising that many are in large debt through loans.

4.Unclear Time Period

The next characteristic of illegal online loans is that the time period is not clear. Yup, most borrowing victims always feel disappointed because the due date of the bill is very fast and does not match the agreement.

For example, if you borrow Rp. 2,000,000 with a maturity of 3 months and it matures on the 5th, the loan application will ask for payment of the bill before the 5th. There are even those 5 days after the loan, which has been billed by the loan.

5. Not Registered with OJK

The last characteristic of illegal online loans is that they are not registered with the OJK (Financial Services Authority). Yup, illegal loans usually don't have a permit from the OJK, so the regulations are as cool as the owner's forehead. Even the collection party does not have a billing certification from the Indonesian Joint Funding Fintech Association (AFPI).

Not only that, the loan application also does not have a complaint service and there is no clear identity of either the administrator or the office address. Usually this application is not available on the PlayStore or trusted App Store.

Well, after you know the characteristics of illegal borrowing, then you need to know also the characteristics of legal borrowing. For more details, just scroll down, guys!

Features of Legal Online Loans

For those of you who want to build or run a home online business idea by borrowing money in the loan application, you also need to know first the characteristics of the following legal online loans!

1.Have a Permit from OJK

The first characteristic of a legal loan is having a permit from the OJK (Financial Services Authority). Yups, guaranteed institutions are institutions that have been registered and get permission from the government. Of course, this online loan platform has a very detailed identity on the internet.

2. Never Offer Via SMS

The next characteristic of legal borrowing is that it never offers via SMS. Just like legal service platforms like that never offer via SMS or WhatsApp, usually they offer through social media or official bazaars.

3. Borrowers Will Be Strictly Selected

The next characteristic of legal borrowing is that the borrower will be selected strictly. Yup, in contrast to illegal lending, which selects the receipt of funds very easily, even with only an ID card, they can already get a loan.

Well, this legal online loan application has a very strict selection, where you are required to attach an ID card, NPWP, and account number. In addition, the borrowing history will also be seen at BI Checking.

If the borrower has a list of loans that are not paid past the 90 day deadline, they will be blacklisted at the Fintech Data Center. So that the borrower can no longer borrow on similar fintech platforms.

4. Interest and Administration Fees Are Very Transparent

The next characteristic of legal online loans is that the interest and administrative fees are very transparent. In contrast to illegal borrowing, where the interest and fees given are very large, while legal loans do not exceed 4%.

In addition, the term of the bill is in accordance with the agreement and there are no threats over the phone such as illegal borrowing. Because legal online loan collectors are required to have a billing certification from AFPI (Indonesian Joint Funding Fintech Association).

5. Complete Identity and Services

The characteristics of the last legal online loan are complete identity and services. Because it is registered with the OJK, the identity of the management and office address must be clear. In addition, there is also a complaint service for when you get a complaint and so on.

So, those are some of the differences between illegal borrowing and legal borrowing. How? It's really easy, guys, to distinguish between illegal online loans and legal online loans.

Oh yes, don't forget to share this article about the difference between legal and illegal borrowing with your friends, who knows, they don't know what the difference between illegal and legal borrowing is:

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VERY IMPORTANT! These are the characteristics of illegal and legal borrowing