Saturday, March 8, 2014

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Personal Loans - A Burden and Nightmare

Personal loans have been around for a long time. In agricultural seasons, farmers borrowed from others pledging to return the amount by the end of the harvest with a certain interest in cash or in kind. This type of loan is of great benefit as the farmer used the money in something good - land cultivation.
The ideas of loans evolved round the unsatisfying wants of the human nature. Growing credit activity as well as fierce competition between banks and finance houses aimed at winning customers increased and the banks and other financial houses started providing more facilities and advantages to sell loans services to achieve high interests and profits.
The wide scale competition has caused some banks to overstep the rules and regulations governing personal loans, which likely ended up at the expense of the borrowers. It contributed to create the phenomenon the society is suffering from at present.
The concept of personal loan is nothing new in the world and it is dated to the period of the world's first recession. Several great economist have given grave warnings about the menace of personal borrowing as "a social problem", which required the intervention of the government.
The Central Bank of every country in the world should lay down restrictions on borrowing for personal purpose for these loans, naturally, are for consumption and not productive.
I would like to say that personal loans are a burden and a nightmare that worry the borrower, and lead to tragedies the borrower wouldn't wish psychologically, socially, and financially. Borrowing has become a culture that dominates the social scene.
Therefore, I call on all consumers to pursue and follow the culture of "saving" - develop resources to avoid the need for money.

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