When you are looking for a small loan, you might have considered a personal loan from a bank or a microloan from an organization that helps people or small businesses in your situation. However, you want to think outside the box and consider all the places where you can source the cash that you need.
Think of a small loan as an investment in your financial future.
Why Choose a Small Loan?
A small loan can provide you with a quick cash infusion that you can use to improve your financial situation. You can tap into multiple ways to obtain the money you need, but a small loan provides you with several benefits that you will probably prefer in the long term.
Plus, small loans are easier to pay off and generally come with lower interest rates and fewer fees.
Types of Small Loans
When you start a search for small loans, remember that you have several options. Your results depend on the place where you choose to borrow and the options those lenders provide. Small loans can reach your wallet via:
- Banks
- Credit card cash advances
- Digital platforms like MoneyLion
- Credit building loans
- Cash advances from banks or online platforms
Because all these lenders are so different, remember that they come with varying fees and requirements. Certain loans are easy to obtain, but others are far more complex. Because you’re borrowing a small amount of money, go for lower fees and interest rates whenever possible.
The Benefits of a Small Loan
Small loans provide you with several benefits that you might not have considered, especially when you have so many options at your disposal. A small loan can help you:
- Build your credit
- Pay for unexpected expenses
- Handle school fees or buy supplies
- Assist with a medical bill
- Help make a down payment on a large purchase
While these benefits shift from one loan to another, you should look into what’s most appropriate for you. For example, a small cash advance might be appropriate when you need to pay for a field trip for your child. However, you might turn to a credit builder loan when paying off a larger medical expense.
You might use a small loan to build credit, but you might also use it to get out of a financial bind. Sometimes you can plan ahead, but other times, you can’t. Be honest with yourself when shopping for a loan.
About MoneyLion
MoneyLion is a digital financial platform that makes it easy for you to manage your money, working on the mantra that it wants to help “the 99% feel 100%” about their finances.
To that end, the platform offers options like:
- Mobile banking
- Cashback rewards
- Round ups
- Zero hidden fees
- Financial calculators and advice
- Investment and crypto accounts
- Credit builder plus loans
- Cash advances
Frequently Asked Questions
Where can I borrow small amounts of money?
You can borrow from digital financial platforms like MoneyLion, your credit card issuer or potentially a credit union.
Can I borrow $1,000 from the bank?
Generally, banks prefer to offer larger personal loans. You can opt, instead, for small loans from an online financial platform like MoneyLion.
About Patton Hunnicutt
Patton Hunnicutt is a contributor and editor at Benzinga. He’s worked for several years on financial content, addressing issues related to personal finance, investments, retirement, and more.