Alternative Financing: How Non-banking Options Like HC Mutual Can Help You

Alternative Financing:
How Non-banking Options Like HC Mutual Can Help You

March 31, 2021 | by HC Mutual

Saving and responsible borrowing are some of the most important things to consider for your financial growth. They help you build up a good credit score, prepare for emergencies, get you your first car or home, and most importantly, make sure that you can give your family a comfortable life.

But sometimes, saving or borrowing through traditional institutions like banks can be tough. The list of requirements is long, approvals are strict and often impossible with a damaged credit history; opening and maintaining a savings account can even cost you extra.

If you find it difficult to access essential financial services because of these hurdles, rest easy—there are many options still available to you. Let us walk you through the basics of alternative financing and how this can help you achieve both your short-term and long-term financial goals.

What is alternative financing?

Nonbank or alternative financing are services, loans, or funds that are secured outside traditional banking. They can be provided by individuals, businesses, or financial institutions that are government-run or privately owned.

HC Mutual Building and Loan Association

is one of the many home-grown, non-banking institutions in the Philippines. We empower everyday Filipinos by helping them build up their savings and making sure that their dreams and financial goals are within their reach.

How is alternative financing
different from banks?

Better access
Getting the funding you need can be as simple as a few taps on your phone. Many alternative lenders and nonbanks rely on technology, making their products and services available online.

More flexibility
While non-bank institutions still need to follow guidelines and rules, they can better personalize rates and fees, and create more options for different financial needs.

Easier application and approval
Alternative financing requires less documents, is more forgiving when it comes to credit, and can sometimes require lower down payments depending on what service or loan you are applying for.

HC Mutual, for example, understands what it means to live on a budget, paycheck-to-paycheck, which is why we adapt a holistic view on our members’ credit history and worth.

Less waiting time
Alternative financing can release loans or provide funding within a few days. And in some cases, like the KayaMo Home Loan and KayaMo Cash Loan, within 24 hours of approval.

A world of possibilities: Alternative Financing Services

There is a wide range of non-banking services available to you. We’ve listed down the essentials to help you get started:

Building and Loan Associations

The main purpose of these financial institutions, like HC Mutual, is to make owning, purchasing, or building a home easier for more people, especially those who may be underbanked. Individuals or members subscribe to a number of shares for a time frame of their choice, investments that grow through interest, which members can then claim after maturity. As a benefit of being a shareholder, they also gain access to the institution’s loans and financial services.

Digital wallets

In this age where cashless payments are prevalent, nonbanks enable digital money management without having to open a savings account that requires a maintaining balance.

Personal, salary, and mortgage loans

Applying and receiving loans through alternative financing is easier and faster, with many financial institutions offering more flexible terms.

Business loans

Small businesses often have a harder time getting loans from banks. But by opting for alternative financing, even burgeoning entrepreneurs can get the capital they need to kickoff their business.

Peer-to-peer (P2P) lending platforms

P2P or crowd lending offers the same benefits as any alternative financing service, but with lower interest rates. This is possible because P2P platforms do not own the loans—they simply connect alternative lenders to borrowers.

Ask before you leap
We understand that going to the nearest nonbank can be tempting right now. But to make sure that you can make the most out of your hard-earned money, look out for these three points:

1. Interest rates – Alternative lenders can afford faster approvals and funding because of their interest rates. Before choosing a financial institution, make sure to look at your options and compare their fees and rates.

2. Transparency and simplicity – Did they clearly state and list down the fees and interest rates? Are the terms and conditions easy to understand?

3. Credibility – Try asking around or reading online articles. Have people ever worked with this financial institution before? Are they trustworthy? What are other customers saying about them?

Final Thoughts

Traditional banks will always be our first thought when it comes to loans and savings. But when getting access to crucial financial services becomes difficult, you can always look at different avenues. There are many options available that are safe, secure, and reliable—just make sure to ask around and research, and you’ll surely find the best fit for you and your financial goals.

We’d love to talk to you more about this HC Mutual-Acquired listing. Kindly fill out the form below and a member of our team will give you a call to discuss details.

Thank you for your interest.

We will be in touch with you soon to discuss more about your chosen home listing. Looking forward to talking to you!

Alternative Financing:
How Non-banking Options Like HC Mutual Can Help You