The History of Lending

The History of Lending

Each of us has a different visualization of the phenomenon of “lending”. Actually, it ends up with the well-known issue of taking the amount in exchange for interest. The lender provides the funds to the borrower and agrees to receive the lump sum of the amount plus the interest. The lending issue is not something new, otherwise, it has old roots coming from ancient Europe.

The First Steps of the Lending System

The origination of the lending system is linked to ancient Greece and Rome. The most ancient types of lenders are considered the pawnbrokers that started to take possession of the collateral in the exchange for money. The next volume of upgrade in the lending mechanism was an exchange of goods against the funds. For instance, borrowers were obliged to provide exact types of goods (due to the prior arrangement) in the exchange for the money. In this phase, the “zemidar” system appeared. The principles of “zemidar” system revealed a new form of fund lending in the exchange for work. For example, farmers borrowed money from the lenders and agreed to accomplish the exact scale of jobs against the financial obligations. The new era of lending has started nearly since the 1800s when the “saving funds society” came to the reality. However, later the property secured loans gained the advantage over the “exchange form” of lending. After this “game changer’s” shift, the field of lending went deep into the world of stable growth.

Future of the Lending System

Nearly since the beginning of the 21st century, digitization has affected banking, financial services and shifted them into the modern world of service providers. An enormous amount of financial software has been developed for minimizing the manual procedures in the lending system. The existence of new kinds of platforms granted a chance to make the lending process much easier through online and mobile banking. Nowadays, most financial institutions provide their users an opportunity to commit online financial activities such as opening accounts, lending funds or even making repayments.

In accordance with the survey of the BBVA, the percentage of customer loan applications filled out through exactly mobile phones increased by 45%. Why the survey concentrated the focus on the loans applied through cell phones? Basically, the main reason is hidden under the fact of convenience to apply. The borrower has no need to be at home or use the computer to apply for loans. Relatively recent times the Fintech (the financial technology) boosted the peer-to-peer lenders’ websites. The peer-to-peer lending web pages suggest direct online loans without any requirements of physical presence. As well as there are many webiste that act only as connecting platforms between trustworthy direct lenders and borrowers. As a final analysis, we understand that the wave of technology development will lead us to the automated world, where everything may come to be available in the online space.

Payday Loans as a Beginning of the Future System

Nowadays, online payday loans are very popular in the US due to their uncomplicated and automated mechanism. Applying for payday loans is as simple as buying something online using just your cell phone. Payday loans are sort of short-term obligations that are designed to be paid off within short time limits. You may apply online via our website: Shinyloan.com and get an instant credit decision on the same day of your application. Never mind if you have a bad credit score or history, you may still be eligible to apply for next-day loans online and find a direct lender. Please bear in mind, that our platform does not provide funds, we just help borrowers to find direct lenders that will be willing to lend the funds. Payday loan services are available in the majority of states, and if you want to apply for one, you can find lenders, for instance, via browsing “payday loans in Delaware”, “same day loans in Connecticut” or wherever you live.

More posts