What are the differences between a bank and a loan company?

Over half of the respondents had a problem with giving correct answers to almost 50 percent. questions in this area. Almost 2/3 of respondents do not know the rules related to granting loans and borrowings and do not know exactly how these two products differ.

Theoretically, if we have knowledge of these topics, we do not use it in practice, as evidenced by the number of Polish debtors. Check what a bank is and what a loan company is and how the offers of both institutions differ.

What is a bank?


Pursuant to the Act of 29 August 1997 on banking law, a bank is a legal person established in accordance with the provisions of acts, acting on the basis of permits authorizing to carry out banking activities risking funds entrusted under any repayable title.

The said Act also includes activities carried out by banks, including:

  • keeping bank accounts,
  • financial obligations (loans and advances),
  • issuing securities,
  • issuing payment cards,
  • receiving, storing and spending clients’ money,
  • granting confirmations and sureties.

What is a loan company?

The activity of loan companies is regulated by the provisions of the Civil Code, the Act on consumer credit and the so-called anti-usury act. Sometimes, loan companies are mistakenly identified with parabanks. Parabanks, however, are not subject to the above-mentioned documents.

Loan companies deal with granting loans, i.e. making a specific amount of money available to the borrower, for a specific period of time on terms agreed and accepted by both parties.

Banks and loan companies and the law

Banks and loan companies and the law

Each bank is covered by the financial supervision and a deposit guarantee. It roughly means that when the bank becomes insolvent, the Bank Guarantee Fund provides the customer with a refund.

Loan companies are less regulated institutions, although they are not subject to the Fund’s guarantees, but are supervised by the Polish Financial Supervision Authority.

Offers from banks and loan companies – how do they differ?

A cash loan is a quick way to raise money for any purpose. Money is usually available on hand and on favorable terms, and it can be used to buy a car, renovate a bathroom or travel abroad. What is the difference between an online loan and a cash loan?

A loan is an agreement that we can enter into with both the bank and the loan company. Currently, banks have the widest loan offer, but loan companies also offer interesting loan offers. But what are the differences between the offers of both?

How much can you borrow and for how long?

How much can you borrow and for how long?

The maximum amount of the loan in banks is about 50 000 to 100 000 USD, but it can also be higher – business customers can borrow up to 500 000 USD. The repayment period is generally up to 5-10 years, but you can also take out a loan for a shorter period.

Loan companies offer amounts from USD 100 to USD 5,000 for payday loans and from USD 5,000 to even USD 20,000 for installment loans. Money from payday pay must be given to max. 30 days, for this installment loan you can pay up to 2 years.

What conditions must be met?

Banks assess the borrower’s creditworthiness and creditworthiness. Creditworthiness is analyzed based on the amount of income obtained, monthly living costs and other expenses, family situation, education, and occupation. Banks take into account their credit history when determining their creditworthiness.

The applicant must also meet the basic conditions such as the dow important d yellow card, or residence in the country. The conditions for obtaining a loan from a non-bank company are not as restrictive as in a bank, which does not mean that everyone can receive it.

The basic requirements of a bed d dow personal address in Poland, as well as possession of Brine for your income by at. Some companies require a positive credit history, but you can also come across loans.

Bank or loan company – where is it better to take a loan?

Bank or loan company - where is it better to take a loan?

At present, a loan via the Internet can be taken in both a bank and a loan company. An online loan in a bank can be obtained primarily by its regular customers who keep a bank account for a minimum period of 3-6 months, while the offer of a loan company can be used by anyone, even a new customer.

Are online loans and payday loans safe? To find out, you need to check the Register of Loan Institutions. The presence of a given company on the list shows that it conducts its business legally and you can use its services without fear.

To answer the question of where it is more profitable to take out a loan, you need to analyze your situation. If we need a small amount and for a short period, the offers of non-bank institutions may seem more attractive.

When we care about time, the loan company will probably consider the application faster, although in banks this procedure is now not as long as it used to be. Usually, the decision is issued on the same day. In the event of high demand for additional funds, it is worth reviewing the current bank offers.