Compare the best options on the market and choose the one which best adapts to your day-to-day needs.
Our Rating: 9.5/10
- Loans available for any purpose
- Friendly interest rates including a 12.1% annual interest rate
- Flexible loan limits of up to €50,000
- Convenient repayment periods of up to 120 months
- Few additional loan fees
- Fast concessions
- Fewer eligibility criteria
Banco BPI Portgual
Our Rating: 9.2/10
- Flexible loan amounts of up to €30,000
- Long repayment terms of up to 72 months
- Available for a variety of purposes
- Attractive interest rates and 11% APR
- Fast approval within 24 hours
- Insurance is optional
- Top loan conditions
Our Rating: 8.9/10
- Flexible loan size of up to €30,000
- Fast approval process within 48 hours
- Hassle-free application through an online platform
- Customizable repayment period of up to 120 months
- Less stringent eligibility criteria
- Prefers funding applicants with an income
- Fixed interest rates on long term loans
Banco Santander Totta S.A.
Payday Loans in Portugal, All You Need To Know:
Take a free 5-minutes read into the best payday loans to be fully equipped with the knowledge you need before contracting a payday loan in Portugal. We help you make an informed financial decision by marshaling all the necessary information about credits in Portugal and what might be affecting them now.
The current market for payday loans
- We give you a monthly news update about consumer loans and what to consider before taking them out. Take a minute to get a hang of the state of the financial markets in Portugal and whether it is the best time to take out a payday loan.
- Portugal is one of the many countries in the EU that have been hard-hit by the ongoing Russian invasion. The war came in at a time when the EU economic recovery was almost at its peak. The economy is now at stake because of the high inflation of commodities whereas non-bank lenders are vulnerable to credit and liquidity risks.
- For as long as the Russian invasion goes on, the May 2022 Financial Stability Review states that the situation may worsen for big banks because the war has posed a major problem to the economy and tampered with the supply chains. These strong banks may fall prey to credit risks and reduced profits, hence, crippling the economy’s recovery.
- The Russian-Ukraine war is a major hindrance to the EU’s economic recovery, experts say. The situation remains dire as the war persists. However, if Russia and Ukraine resolve their differences peacefully, the financial market could take a huge sigh of relief. But as it is now, the effects of the war are spilling into the global economy.
Rights and Duties of Credit Consumers in Portugal
The Banco de Portugal has outlined several rights and duties of credit consumers before and as they take out loans in Portugal.
Right to access all pre-contractual information before taking out the loan
Payday loan consumers have the right to access and go through all the information and the details of the contract. This includes all the terms and conditions of the loan (interest rates, amount, repayment terms, and commissions) in the standardized information sheet (SIS). The consumer should get a chance of comparing different loan conditions and proposals to determine the offer that best suits them.
Moreover, the lenders should clear any doubts that consumers develop along the way and evaluate the risks that consumers may face when taking out the loan.
The bank, therefore, should provide a copy of the contract documents before and after the customer signs up for the loan.
Right to receive updates from the lender during the repayment period
The loan consumer has a right to receive periodic updates on any changes that may happen in the course of repayment. While these changes might have been outlined in the contractual documents, the lender is required to notify the borrower periodically about them. The Portuguese government requires that the lender sends a maximum of 6 annual debt statements without charging any fees.
Duty to take out loans responsibly
One major consideration the consumer is required to take is their income viz-a-viz the monthly installments they’ll be required to pay upon taking out a loan. The loan should cover between 35-40% of your monthly income to be able to assume repayment of the loan comfortably. A loan eats into your monthly income for a long time, hence be braced to have deductions without straining.
Different lenders have different conditions for their financial products, hence, make a good comparison of loan offers to end up with the best available offer.
Duty to evaluate pre-contractual information
Once the consumer receives SIS, they are expected to read through the contract details and compare a few other proposals to get the one that best addresses their financial situation. In this way, the consumer is able to clear all the doubts with the lender before signing up for the loan.
Duty to provide all the information required by the lender
Since the lender takes a risk in giving out a loan, the consumer has a duty to provide genuine information about their financial condition to the lender both during the application process and in case of any changes during repayment.
In this way, the lender can evaluate the consumer’s level of debt, income, and expenses.
Obligation to comply with the loan conditions
Once the borrower has entered into a loan agreement, they are obliged to comply with every single condition of the loan including paying monthly installments and any other commissions.
How to apply for a payday loan?
While the process of applying for a payday loan may vary with different entities, below are the most common steps you’ll take to get financing:
- Compare loans from different lenders either online or in-office. Working with at least three lenders whose loan conditions favor you, compare the proposals to end up with one that’s most consistent with your economic situation.
- After selecting the institution, fill out the application form you receive. Be sure to fill out all the blank spaces with genuine and accurate information about yourself and your preferred loan conditions (cost, amount, term, commissions, etc).
- If applying online, you’ll receive pre-approval after a few minutes. Lenders send pre-approval after about two days for physical application.
- Be sure to send all the needed documents by email, scanning, or uploading photos, depending on your lender’s preferences.
- If all goes well, the lender will send you pre-contractual information. Analyze the details of the information noting how the loan conditions (cost, repayment period, amount, commissions) may evolve in the future to avoid any surprises.
- Sign up for the contract either in-office or online through a digital signature.
- Receive the funds either after a few minutes or after a few days, depending on the lender.
Requirements for payday loans in Portugal
The lender is not in any way obliged to finance you even when you meet all the set-out requirements. However, leaving out a single requirement may have your application dismissed.
So, what requirements will you have to meet?
- Be of the right age. Many lenders will consider 18-year-olds as minors and have their minimum age limit as 21. Borrowers who are older than 75 may also not easily access financing in Portugal.
- Have a Portuguese residence. Many lending institutions prefer giving out loans to applicants within the country. Hence, whether a native or an expat, you’ll be required to show proof of residence in Portugal.
- Your credit-worthiness. The lender will take time to assess your level of debt before granting you the funds. Hence, work to maintain a healthy level of debt to avoid a negative credit rating by the Central Credit Register.
- Your level of income. You’ll be required to demonstrate your ability to repay the loan by earning some good income. Many lenders will not finance you if the monthly installments take 50% of your income.
While some entities will finance you regardless of your level of debt, it’s your duty to maintain a good credit history. Before taking out a loan, use the above parameters to determine whether it suits you.
Documentation for applying for a payday loan
The entity will require evidence that you meet their set-out requirements. They will, therefore, require you to send supporting documents.
- Copy of your national ID, passport, or other forms of identity
- Permanent or temporary residence permit card
- NIF number
- Bank statements showing your recent income and expenses
- The last three payslips or documents showing your income whether as self-employed, retired, etc.
- Documents showing your purpose for taking out the loan or the budget of your project.
Who grants payday loans in Portugal?
Portugal is far from the era when banks monopolized the lending market. This happened after the 2008 financial crisis when many other lenders got their way into the market.
By now, various lending institutions are trying to catch up with the banks, who still dominate the Portuguese financial markets.
Entities that grant payday loans:
- Bank entities
- Credit Financial Institutions (CFE)
- Private Lenders
- P2P Lending Platforms
Obtain financing through banks
✔️ Customized financial products
✔️ Grants big loans
✔️ Long repayment periods
✔️ Friendly interest rates
❌ Tedious application process
❌ Expensive due to many commissions
❌ Seniority is a determining factor
❌ Many related products
Credit Financial Institutions (CFE)
✔️ Grants loans for any purposes
✔️ Friendly interest rates
✔️ Few additional charges
✔️ Fast application process
❌ Strict eligibility criteria like banks
❌ They can operate only through stores or dealerships
Getting loans online with private companies
✔️ Hassle-free application process
✔️ Lenient eligibility criteria
✔️ Seniority is not required
❌ Unattractive interest rates
❌ Financing even with negative credit history (may cause over-indebtedness)
Payday Loans through P2P Platforms
✔️ Friendly loan conditions
✔️ Fast and completely online application
✔️ No related products
❌ Slower concessions
❌ Strict on requirements
❌ Few platforms that provide payday loans
FAQ: Frequently Asked Questions
What is a payday loan?
A payday loan is a form of consumer credit that’s designed to address small economic emergencies. The processing of the loan is fast and designed to have short repayment periods because of their small amounts. Moreover, payday loans have high interest rates, hence, are mostly taken out when the lender lacks an alternative source of money. The purpose of taking out a payday loan may be renovating your home, buying electronic appliances, buying a smartphone, and finalizing your project, among others.
Why don’t you give me payday loans?
While payday loan lenders have fewer eligibility criteria than other loan types, the lender will reject your application if you do not meet their irreducible minimums. For instance, many applications are dismissed because the borrower records a negative credit history, collects a lower income than what is required to give him a loan, lacks a Portuguese residence permit, and may not be of the right age.
Moreover, the lender will also not risk financing you if the data you provided on the application form does not correspond with that in the documents.
What is the binding offer of a payday credit?
A binding offer is a document that your lender sends you before signing up for the loan agreement. The document contains all the clauses and conditions of the credit which you’ll be required to go through in detail for 14 days before finally deciding on whether to settle for the loan or not.
Can payday loans be paid in advance?
Borrowers are allowed to repay the loan in full or part before the end of the agreed time. However, the loanee is required to notify the lender of this decision and may face some refund charges. The borrower will also be required to pay the whole amount they would have covered by the end of the repayment period – accrued interests, commissions, and other fees.
What if I take out a loan online and then regret it?
The Portuguese Law allows consumers to withdraw loans in the first 14 calendar days. Beyond the safe 14 days, the borrower may face some penalties.
When to Apply for a Payday Loan
A payday loan is designed to address certain economic contingencies that may have the borrower shift the entities. The financing may take time, depending on the entity, hence, the borrower may not mind waiting.
Be sure to try out loans with our above-mentioned entities to enjoy a loan that’s the most suitable for you.
When to Apply for a Fast Loan
A fast loan is applied for when the borrower needs instant funds. They are mostly taken out during economic emergencies. However, if your need is not urgent, you may consider taking out a different credit.
Before taking out a loan, it’s prudent to assess our financial situation and set out to look for a consumer credit that’s most compatible with us. As you take out a loan, note that the lender is not in any way obliged to grant you finances, even when you meet all the set-out requirements.
Once you take out a loan, you’re obliged to pay it back under the agreed-upon terms and conditions, hence, borrow wisely.
About this page, our methodology
About this page: we are out to help you to get the best financial product that’s consistent with your financial situation. We, therefore, marshal the best available information about consumer credits and what factors to consider as you compare the options so you may end up with the most attractive product at the moment.
Source: the information regarding the main characteristics of loans in Portugal and their current regulation comes from the Banco de Portugal, the Portuguese Consumer Credit Act, among other reference portals.
Methodology: The data relating to the conditions of these products (amount, term, interest, etc.) have been obtained through online research and consultation of the official statistics of the aforementioned reference sources.
About Us: FUNDGECKO is an online comparator website that helps borrowers who are indecisive about consumer loans and what option to hire. We help our users compare the options like pros by providing all the information they need about consumer credits and how to end up with an option that best addresses their situation.
Note: the services we offer are totally free for the user, as FUNDGECKO obtains its income from advertising and its featured products.