The Salary-backed-loan is a financial solution for employees with a permanent contract and pensioners (up to age 85) for obtaining liquidity to implement several medium-long term goals.
Mara Casagrande, Marketing, Back Office & CRM and Recruiting Coordinator of Capitalfin, explains how this product works.
For a salary-backed-loan the instalment agreed is deducted from the salary (or pension) and paid to the Bank that allocated the loan every month, by the employer and/or the Pension office for pensioners.
With personal loans, the instalment is repaid to the bank/financial institution directly by the person requesting the loan in an agreed manner (e.g. current account debit, postal bill).
One of the advantages of a Salary-backed-loan is definitely being able to receive the loan in 10/15 days.
Since the Salary-backed-loan is strictly linked to the customer’s monthly income, the product foresees an insurance that protects both parties involved; that service covers two risks:
The instalment may never exceed one fifth of the monthly salary/pension and this avoids an excessive level of indebtedness; therefore, guarantees maintenance of a good expenditure capacity even while repaying the instalments.
Capitalfin experts always recommend declaring and weighing one’s financial commitments and expenses, so that the consultant can recommend what is best for the customer and agree on a sustainable instalment based on his/her economic conditions.