Bank Loans

Rejected loans

The financial market, particularly the banking sector, is undoubtedly a major economic engine that drives the flow of our financial resources. In fact, the impact of the financial industry on the country’s economic performance is remarkably significant as it plays a critical role in the overall growth and development of the economy.

The finance market provides a diverse array of lending services and trading opportunities that enables businesses and households to cope with the economic pressures brought about by a number of unforeseen and unanticipated circumstances.

A well-developed and dynamically efficient financial market mobilizes both savings and economic investments, thus increasing the growth of capital and the efficiency of the economy. The ability of banks to extend credit has an important part in our economic activities, specifically on our spending decisions and investment.

Commercial banks have been traditionally a popular source of loans in the financial market. A bank loan can be used by entrepreneurs to expand their marketplace, increase inventory, as well as ensure the smooth functioning of their day-to-day business operations. Apart from large and small scale businesses, a number of individuals and households also obtain credit from banks to deal with tough financial emergencies and address the surging cost of medical care, college education an prime commodities.

Today, numerous banks offer various types of loans that are designed to suit the varying and evolving financial needs of many consumers. Common loan categories include secured, unsecured, fixed rate, installment and convertible. The good thing about bank loan is that it offers a wide range of competitive advantages such as greater flexibility, more reasonable terms, lower interest rates and immediate access to financing.

However, despite these advantages, lending from banks is much more difficult compared to other financing options. There are certain conditions, mechanisms and policies that affect the capacity of banks to extend loans to consumers. Unpredictable circumstances such as the economic recession have forced the banking industry to rigorously strengthen their lending standards, thus restricting the opportunities of borrowers particularly those with bad credit to easily access loans for their urgent financial needs.