Social loan
A social loan is a special way of borrowing for lower incomes who cannot get a loan elsewhere but still need money urgently.
A social loan can be used to finance a house or for normal use and is mainly known in Belgium. In the Netherlands, Sociale Banken Nederland (SBN) provides social loans.
These Social Banks Netherlands are a collaboration between 14 regional social credit banks and operate on a non-profit basis. So cheap loans, but borrow responsibly for a useful purpose.
A loan for a new television or borrowing money for a holiday will not be possible from the SBN. These loans are therefore only provided for lower income (up to 130% of the applicable minimum gross salary).
The SBN does charge an interest rate, but this will be much lower than with a commercial bank.
Advantages and disadvantages of a social loan
Pros- Very low interest and good guidance.
- Only borrow money for essential things.
- Only for very low incomes.
- Only borrow money for essential things.
