Of course, yes, if a person wants a loan for a very short period and for a small amount to fulfill his need, then definitely small amount loan matters. For every person, that “small amount” varies. For the middle class, it will be different for the lower class, and for the higher class, there will be a high difference. And for small amounts, people prefer to take loans from money lenders, mortgages, pledges, and short term loans. For some people if they want to purchase a mobile phone which is expensive for him he can choose motorcycle pledge (จำนำมอไซค์ which is the term in Thai), through this he can easily get a loan. And in auto loans also people pledge their car and motorcycle and pay instalments. Because in this case, ownership does not change until he would not fails to pay back the money with all interests.
Short term loans
As the name suggested, short term loans are for a short period. A person can pay it back within one year. And from trusted financial institutions, you can get it for a lower rate of interest. Nowadays, in short term loans, people buy things like mobile phones, refrigerator, AC, microwave, washing machine, and many more different things. They get these loans from the company only, and they get it in a very less rate of interest. Sometimes companies have an offer for zero percent finance. So they get their asset in a zero percent interest rate. There are benefits for all these loans following
- Upgrade the standard of living
- People start purchasing the things they need
- Pay in instalments
- They can buy more than one thing at one time because they have to pay in a small amount
An entrepreneur takes loans to upgrade their business like technology, skills, and production. They take loans to increase their profits and for better utilization of resources. So, short term loans are beneficial for the entrepreneur and for industrialists also.