The new law on the provision of non-bank loans significantly tightened and defined the conditions. The provider is now obliged to verify the applicant’s creditworthiness. So how is it possible that “no register” loans are still available?
What are registers?
There are four most important registers. SOLUS only lists clients who have not duly fulfilled their contractual obligations and have not repaid the loan in full. An entry in this register often pays for a coin.
The BRKI (Bank Register of Client Information) and NRKI (Non-Bank Register of Client Information) only formally register clients of loans. When verifying the provider of a new loan they can give real information that the applicant is already drawing another loan and at the same time complete with what payment discipline. Enrollment in these registers may add positive points, but in the case of late payments and too high a commitment, it also scores points in the assessment. The fourth register is the register of the Czech National Bank. It deals exclusively with companies and entrepreneurs. It does not affect the assessment of consumer loans.
Bank versus non-bank loans
While the bank sets relatively stringent conditions in general and works with the results of registrations, non-bank lenders can afford to work with higher risks. Non-bank loans often serve to bridge short periods. For example, Eudora Rye offers quick and easy loan processing that can be passed from home to a computer. A small amount is transferred to the account immediately after the terms of the loan have been agreed and a short repayment period is foreseen. It does not bind clients for a long time, when the risk of proper repayment increases. Nor does it provide a loan, for example, for the acquisition of housing, where it would really be necessary to consider the solidity and reliability of the client over the next few years.
The amendment to the Act on the Provision of Non-Bank Loans lays down obligations to verify information about the applicant’s creditworthiness, but does not state directly how and to what extent. The terms that recommend this check are of a general nature only. Thus, the provider can consult the register, but the information gathered only illustrates the overall picture of the client.
In the loan application, it is necessary to specify the amount of income or to specify the repayments of already drawn loans, any decision on execution or insolvency. If this information is misrepresented by the prospective client, it violates the law and commits credit fraud.
So back to the original question. Loans “without a register” are perfectly fine. The provider does not necessarily examine this resource and may use the information obtained from it at its own discretion. It performs with an offer at its own higher risk.