Over 80% potential borrowers indicate the nominal interest rate as the most important parameter when choosing a bank granting a cash loan. The second installment (about 60 percent of responses) was the monthly installment. Half of the respondents said that the margin was also important, and only about 30 percent. respondents remembered that the price of the cash loan was also determined by the possible insurance. The research, commissioned by Betin Bank, was conducted at the threshold of this year’s autumn by the Judeward Green Institute.
The interest rate
Commission and insurance-related costs are the main components of the Actual Annual Interest Rate (APRC). All these elements were reflected in the answers given by the respondents. However, the percentage differences show that customers do not analyze the most important loan parameters together. It is worth noting that only the APRC takes into account all costs and fees related to the contract, which makes it possible to objectively compare the offers of various banks – notes Katarzyna Bajor from the Retail Credit Office Betin Noble Bank SA. He adds that in recent years, thanks to numerous information and education campaigns carried out by both banks and consumer organizations, one can observe a gradual increase in awareness among people using financial services and products.
Know the cost of a loan before taking it
It is worth recalling that consumers have the right to know the cost of a loan before taking it, and the law limits the maximum interest rate on loans (up to four times the so-called NBP Lombard rate). However, we should remember that the nominal interest rate differs significantly from the abovementioned APRC. For ease of reference – most banks provide examples of APRC for a selected loan in their loan offers. This calculation helps in comparing offers.
The Judeward Green Institute is also checking what Poles spend money borrowed from banks. The financing of the cost of renovating the apartment and purchases of home appliances / electronics are invariably dominating.