Experts say that instant cash loan providers may soon face new competition in the quick loans department originating from pawnbrokers, called ‘borro loans.’
Providing short term loans to customers, borro loans are a service given by pawnbrokers which operate in a manner quite similar to your run of the mill instant cash loan. The most noteworthy difference is that the repayment of a borro loan can sometimes be much less expensive.
These loans are less expensive to repay because borrowers will secure an item against their credit, such as art work, a vehicle, a piece of jewellery, or some other valuable object. Doing so sets lenders up for secured instant cash loans, and that means interest rates are much lower on a borro loan than an instant cash loan due to its secured nature.
The typical instant cash loan will see you paying back an additional £25 to£30 on a £100 loan over a one month period. However, borro loans are much less expensive, leading to paying back as little as £6 on that same £100 loan.
Much like their instant cash loan provider counterparts, borro loans do not require a credit check to secure credit. Moreover, cash can be made available nearly immediately, which is an excellent service in the event of an emergency that requires a sudden expenditure, and with interest rates on borro loans being so comparatively low, instant cash loan providers may soon be given a run for their money by pawnbrokers and their new lending services.
The downside to these new types of loans is, of course, needing to give up possession of an item in order to secure your low interest rate. However, many borro loan services even offer free shipping on your items to make things more convenient.