A recent Monklo survey reveals that the French expect banks to have a greater share of societal commitment, and concrete actions to help improve their purchasing power. They believe that they have a role to play in healing social inequalities and contributing to the transition to a more socially responsible economy. And for that, half quotes as a measure … the democratization of microcredit. But what exactly is microcredit?
Microcredit, the financing of modest households
Popularized in developing countries, microcredit also exists in our countries! It allows the most modest households to finance projects on which banks could not follow them, for lack of guarantees on their solvency. Microcredit makes it possible to grant a loan of low value to the least fortunate people; he has earned his credentials in Asian countries where he has proven time and again his effectiveness. In Europe, it is still little used, although it appeared among professionals in the late 1980s. Today, in France, a person who wants to contract a personal microcredit can get a sum up to to 3 000 €, even more under conditions. Then, its repayment works like that of any loan, with monthly payments to repay over a shorter or longer period (up to five years) while rates vary between 1.5 and 4% – this is reduced rates.
Banks do not enter the equation
Microcredit is intended exclusively for households with very little means or no job stability (fixed-term, temporary) insofar as it is granted only for loans of small sums compared to consumer credit. Indeed, the consumer loan is granted up to € 75,000 when the applicant’s file provides guarantees (stable employment, savings capacity, etc.). Use our free credit simulation tools if you want to prepare a personal loan with confidence, by evaluating in a few clicks the monthly payments and the cost depending on the amount and duration chosen. If consumer credit is issued by lending institutions – including banks – microcredit is obtained through a social support network such as a CCAS, and does not include fees. A talking image? With a microcredit, we will finance a driver’s license whereas with a consumer credit like the car loan, we will rather acquire the vehicle.