Consumer credit, consumer credit, “No matter-what” -Credit, small loan or Mini credit – in terms of their credit offers use and savings banks often own names. Especially in terms of microcredit and mini-credit, it is often difficult to delineate in practice. For legally protected these terms are not. In addition, there is no specification as to which loan amount the respective terms may apply. Nevertheless, the terms small loan and mini loan clearly differ from each other. With the following guide, we would like to explain the differences between the two types of credit.
Small loan as a general term
The term “small loan” is used relatively frequently in practice. Generally, these are loans whose loan amount is manageable. While several hundreds of thousands of euros are being issued as loans in the context of real estate financing, this does not apply to small loans. Their loan amount is usually limited to 10,000 euros, with such a loan is often possible from a total of 1,000 euros. However, the exact minimum or maximum sums are determined by each bank independently.
Due to their comparatively low loan amount, small loans are often granted by credit institutions quite simply. Most institutions offer their microcredit mainly for consumption purposes. Often, therefore, the consumer credit is mentioned , which is ultimately nothing more than a small loan .
Regardless of its exact name, the small loan is offered by numerous banks and savings banks. For this reason, an extensive credit comparison is recommended, which filters out the best credit offers.
The following documents are required to apply for a small loan:
– Proof of income (currently, usually last two or three months)
– proof of identity (eg identity card, passport with confirmation of registration)
– positive Schufa register (if credit rating agencies are consulted)
New product: mini loans
The mini loan is usually advertised as an independent product and is characterized by an extremely low loan amount. This is usually sums of a maximum of € 1,000, so that the mini loan in most cases has only a three-digit loan amount. In fact, the mini-loan fills a gap that classic banks have historically not closed with their microloans of at least $ 1,000. As a result, there are now various providers who specialize in the issue of mini-loans. Due to the credit sums, which are much lower than the small loan, the duration of the mini loan is correspondingly shorter. Again, there is a significant difference between these types of loans. While the small loan is usually paid in installments over at least 12 monthly installments, the mini loan allows in practice significantly shorter terms. The maturities range from 7 to a maximum of 62 days – depending on the provider. For this reason, the mini loan is also advertised as a so-called short-term loan.
There are some situations in which a completion of a mini-loan can help. Thus, the inclusion of such a loan offers above all to bridge short-term financial bottlenecks. At least if its scope is not too pronounced. In this case, the mini-loan may also be a financially rewarding alternative to the classic discretionary loan. At least, an extensive credit comparison is worthwhile.