In times where you are supposed to stay up to date on everything, both professionally and privately, digital devices are indispensable. It is therefore logical that the demand arose for loans for the purchase of laptops, telephones, cameras and so on. A digital loan is therefore a specific installment loan for digital gadgets. Just as a car loan is intended for financing a car, a digital loan is exclusively intended for this type of product. An explanation.
The digital loan is a design by the financial institution HeyBank! As the first bank, it offered its customers the option of taking out a specific installment loan for digital devices. Today, other lenders also offer digital loans for the purchase of digital devices. Attention. Some financial service providers offer the digital loan in the form of a revolving credit instead of an installment loan.
Characteristics of an installment loan are: a fixed term, a fixed interest rate and a fixed monthly amount. It is generally assumed that this type of credit is most suitable if you know in advance exactly how much money you need. The digital loan is characterized by a limited maximum amount and a limited maximum repayment term. This allows the lender to offer you a sharper rate compared to the ‘traditional’ installment loan that you can use for all purposes.
Revolving credit is a bank term for a consumer credit in which the loan amount can be fully or partially taken up again during the term. In this case, the repaid capital can only be reused for the purchase of more digital material!
To begin with, this is a relatively small amount. You therefore run little or no risk of ending up in an infinite debt burden.
A digital loan also involves relatively few formalities. All you have to do is submit an official quotation for the digital device and accessories, after which you must enter the monthly financial options. In most cases, after you have assessed your file, you will receive an online reply the same day. You will then receive the credit agreement on the bus at home and as soon as you have signed it, the money will be deposited in your account.
This is also the difference with an installment purchase. No physical money is made available through a digital installment purchase, but directly purchased goods.
The purpose of a digital loan is to offer a specific (cheaper) rate. Therefore, check this by performing some online simulations. Most financial institutions nowadays have such a tool on their website so that is how it happened. Also note the annual cost percentage. The APR tells you exactly which loan is the cheapest.