Anyone who, for whatever reason, can not get along with the financial means available to him in one running month, has several options for dealing with this situation of acute shortage of money with a wide variety of aids. On the one hand, you can certainly try saving money, which in most cases can be described as rather hopeless, or one deals with the subject of “borrowing”. Be it to temporarily bridge the financial bottleneck with a short-term loan or to use the widespread credit line for your own checking account. Banks grant many current account customers also a disposition credit, called Dispo for short, with which financial bottlenecks can be bridged quickly and easily without the need for a separate credit application.
Assuming that the number one choice, mostly because of its extremely easy availability, is to bridge the financial bottleneck of the credit line, the question arises as to whether and to what extent the credit line is used by German citizens.
Study reveals that half of the citizens do not use the credit line
The market research institute Ipsos dealt with this question quite some time ago on behalf of the German direct bank ING-DIBA. More than 1,000 people over the age of 18 were interviewed in the study on “Usage behavior for the credit line”. The result of the study is not entirely unexpected, but also shows that the credit line represents a permanent burden for a large number of German citizens. After all, however, the study also shows that the majority of people generally seem to get along well with the funds available to them, because more than half of Germans have never overdrawn their current account – in other words, have used the credit line. After all, a partial use of the disposition credit granted with the checking account occurs at around 22.5 percent of the German citizens, whereas around 7 percent of the German citizens use this credit permanently.
The amount of the utilized credit line is more like a small loan
In response to the question raised in the study on the average amount of money raised via the credit line, 28 percent of the banking customers surveyed said they would spend less than 150 euros. 11.8 percent of Germans, however, overdraw their current account with more than 1,500 euros, which can become a permanent debt, because it is critical if the use of a credit line becomes normal. The monthly income is no longer sufficient to be able to repay the permanently exhausted credit line to the bank. In such a situation, according to own data, a respectable 8.8 percent of the respondents. They use the available disbursement credit to cover their checking account every month, and even 6.9 percent of the study participants are consistently in the red with their checking account.
Permanent use of the credit line is expensive
Those who use their credit line so intensively and thus irresponsibly pay for it with, as a rule, very high additional costs, because to date the interest rates for a credit line are still 14% or more. If the credit line is also used over the actually valid credit limit, which in banking jargon is called “tolerated overdraft”, interest rates of 16 percent and more are often incurred. In such a case, therefore, it may often be far more favorable to take installment credit or to reclassify the credit line into a installment loan that is cheaper in terms of interest rates. If we only need a smaller loan amount, a short-term loan, as we offer it from Wackford Squeers, can be a much better alternative than the expensive credit line. That the Wackford Squeers mini loan does not have to shy away from a settlement loan is also shown in this article >> Wackford Squeers mini loan in check
Editor: Markus Gildemeister
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