The 'smarter' personal loan
Starling Bank is introducing what it calls the 'smarter' personal loan in the interests of making borrowing easier.
Investigating how loans have been traditionally offered in the past, the bank decided to look at how people manage and need money in different ways. The bank admits that not everyone needs or wants a loan, but having one can sometimes feel more structured that using an overdraft.
The concept of these loans remain the same - an ability to buy something which is a little more expensive and is paid back over a set period. However, Starling has decided to do away with set up or exit fees and just charge interest at 11.5% - a little more transparent compared the competition it feels, when dealing with its customers.
Another change is the swift application taking only minutes via an app - as the bank says traditionally the alternative with other high street banks, in its view, has always required a lengthy visit when time is short plus miles of paperwork.
It states that answering a few upfront questions can tell you whether you are eligible for a loan rather than wasting a lot of time on a lengthy application and customers who've already bought an item, are eligible to spread the cost over a few months.
In future, Starling Bank wants to offer personal loans even if customers do not have a Starling personal account. Stay tuned - it says!