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BORROW FOR BEGINNERS: MONEY LENDERS

To take out a loan, you can in principle go to various parties, the so-called lenders or personal loan moneylender.

First of all, one can think of non-professional lenders like family and friends, but employers are also often willing to grant loans to their employees, whether or not on favorable terms (for example in the context of a PC-Private Project).

Although people pay a (somewhat) lower interest rate with such lenders, there are also disadvantages associated with this method of financing.

For example, taking out a loan with the employer increases dependence on the employee; it may feel compelled to agree more quickly with certain measures within the company.

For family and friends, first of all, they do not always have the necessary funds; but a more important objection is probably that unforeseen business problems when repaying the personal loan moneylender can have direct consequences for personal relationships.


PROFESSIONAL LENDERS
In practice, people will therefore often use professional donors.
BANKS
The banks together account for approximately 45% of the total credit volume in the Netherlands; they are the largest provider of consumer credit.

Yet they are relatively short-term engaged in offering personal loan moneylender to private individuals: this form of financing only arose around 1950.


FINANCE COMPANIES
Finance companies have been involved in providing consumer credit for about a hundred years.

They originated in the United States around 1850, when manufacturers introduced a form of purchase in order to bring their products within the reach of private individuals and thus increase their market.

Financing companies in the Netherlands account for approximately 40% of the personal loan moneylender volume.


MUNICIPAL CREDIT BANKS
The municipal credit banks are in principle open to everyone, but they are mainly concerned with social lending to people who have difficulty getting a personal loan moneylender elsewhere, for example due to their age, their income or their credit history. In addition, the GKBs are engaged in debt mediation and debt repayment.


CREDIT CARD COMPANIES
Credit card companies also offer a form of credit.

Consumers who pay with their credit card only pay their spending (on average) a few weeks later, without having to pay interest. (When paying with a debit card there is no lending: the amount is immediately debited from the cardholder’s account.)


The companies moreover often provide the ability to outstanding amounts distributed to repay, in which case the consumer should have to pay interest. (This often involves hefty percentages!)


MAIL ORDER COMPANIES
Mail order companies also often offer their customers the option of paying their purchases in a spread, and they charge a credit fee (interest) for this.


COSTS OF DIFFERENT CREDIT FORMS
In many cases, credit card and mail order credit is a relatively expensive form of borrowing; consumers can often finance their purchases more cheaply with the aid of a personal loan or a revolving credit.