3 Ways Cashalo Breaks the Stigma on Credit with Responsible Lending

There is a stigma about credit that is very hard to shake. Debts, deadlines, interest rates, collateral, etc. Aspects that have unfortunately become a burden because of a broken financial system that was never inclusive and has allowed a shadow banking sector comprised of loan sharks and other informal lenders prey on unsuspecting borrowers. At Cashalo, we believe that credit should be used as a tool for progress and opportunity, not as a weapon against it. The ubiquity of mobile devices today, has enabled the new ‘fintech’ sector to reach even the unbanked and empower more people to improve their financial health. For us, this is where the core idea of responsible lending comes in.

 

Freedom from a vicious cycle

Responsible lending seeks to erase the stigma that credit is detrimental to the borrower in the way they have been abused by informal lenders with unscrupulous terms that inevitably lead to a debt trap. In the Philippines, loan sharks are still entrenched in communities where they offer the most pervasive and “convenient” solution to people who don’t believe they have a better option. 

The responsible lending model offers an alternative where, in contrast to this informal sector, it empowers the consumer by utilising a smart technology infrastructure that ensures transactions are on your terms – secure, transparent, and simple,  Cashalo was purpose-built to help every Filipino regardless of background or profession, break-free from the shackles of being ‘credit-invisible’ by giving them greater knowledge, control, and a platform to unlock their economic potential. 

Cashalo believes that financial services such as credit products have long served people giving them access to material goods and services that enrich their quality of life; giving them the means to build businesses, or fund education in turn allowing them to aspire to go beyond their social and economic situation. In other words financial products, dispensed prudently and used wisely, allows people to plan for their future and aspire for financial freedom, as opposed to a life with no mobility or worse, being caught in a vicious cycle of poverty.

Cashalo seeks to grow the economy hand in hand with the borrower, by equipping him or her with the means to improve their stature and quality of life, and in the process, that of the nation. Social responsibility is at the forefront, which is why, along with the service, CashAcademy was created to educate borrowers on financial literacy. 

Cashalo hopes to promote a virtuous cycle, where, as people learn how to be more responsible consumers, they are able to build a strong credit profile over time, and get access to more relevant financial products and services.

 

What does responsible lending mean? The model roots itself on three principles: Custom-made, transparency, and accessibility.

  1. Custom-made: credit products designed for every Juan

While loan sharks tend to loan money to those whom they know cannot pay, Cashalo ensures that the right credit product is offered to the right client. This means that Cashalo provides a wide variety of credit offers, and utilizes alternative and non-traditional data points, so as to ensure that each consumer is provided with the right options to suit their needs. The product options are efficient, secure, and affordable with complete transparency on terms provide so as to reassure borrowers that they can pick the right product for themselves without undue financial strain. 

  1. Transparency: At every touchpoint

While informal lenders are known to sneak hidden “processing fees” here and there, Cashalo strives to offer maximum transparent transparency and control to the consumer at every point. When using the Cashalo app, a consumer can easily keep track of their credit availments whenever and wherever they are. Also, there are no hidden penalties, hidden fees, or rollovers. What you see when you apply for the credit product is what you will need to pay. It’s that simple.

  1. Accessibility: available at the push of a button – whenever, wherever.

Instead of having to go to a bank, wait in line, and fill out paperwork every time you need to borrow money, the Cashalo app makes accessing credit, simple. 

With approvals coming in as fast as 30 minutes, getting access to credit on your terms has never been simpler. Also, Cashalo prides itself on the variety of re-payment options. 

The Cashalo community can make their payments easily through a wide online and offline network through 7-Eleven, Dragonpay, Robinsons’s Bank, BDO, and more. This virtually eliminates late payments due to lack of time or location constraints.

 

Transform your financial well-being. Download the app and see what Cashalo can do for you today. Let us help build your financial future and that of the nation!