Ferratum Review (2023)

Ferratum Review: Is It Worth It? (2023)

Ferratum is an international financial technology company that offers mobile banking, loans, and other financial services. Ferratum’s mission has been to provide consumers with the best, fastest, and most user-friendly financial services through digital solutions. Offering a diverse range of products, from short-term microloans to full-fledged mobile banking platforms,

Founded in 2005 and headquartered in Helsinki, Finland, the company has expanded its operations across multiple continents, making its presence felt predominantly in Europe and the Americas (now part of Multitude Bank)

Ferratum is one of the biggest players for short-term microloans in Sweden, Norway, Denmark, and Finland, with a great track record and an excellent Trustpilot score of 4.7+.

In this post, we cover everything you should know about Ferratum before applying to one of their loans.

Ferratum Website (2023). Unsecured loans without a credit check.

Ferratum (2023 Review): What You Need To Know

What does Ferratum offer?

Ferratum fulfills consumers’ small, short-term, unplanned financial needs. By doing so, Ferratum gives customers more freedom to finance their lifestyles on their terms through solutions appropriate to individual financial circumstances.

Ferratum Logo (2023)

All services are easy, fast, and available online, and customers can have funds in their account as fast as within minutes of the approved application.

As of 2023, Ferratum offers two types of services:

  1. Short-term Microloans: small and short-term unsecured loans to individuals. These loans are often geared toward consumers who need quick access to cash and might not have other forms of credit readily available.
  2. Mobile Banking: The company offers a mobile banking platform that allows customers to manage their finances on the go. This includes account monitoring, fund transfers, and even mobile deposits.

Key Advantages of Ferratum

  1. Quick and Easy Application Process: Their online platform and mobile app allow users to apply for loans swiftly. In many cases, they provide instant or very rapid decisions regarding loan approvals.
  2. Digital Convenience: With a primary focus on mobile banking and online lending, Ferratum allows customers to access and manage their finances from anywhere at any time.
  3. Flexible Loan Amounts: Ferratum offers various loan amounts tailored to meet the diverse needs of its clientele. This flexibility allows customers to borrow amounts that align with their specific requirements.
  4. Wide Reach: The company operates in numerous countries, making its services accessible to diverse customers across different continents.
  5. Unsecured Loans: The short-term microloans don’t typically require collateral, making them accessible to individuals who might not have assets to pledge.
  6. Transparent Terms: The company provides clear terms and conditions on its website, detailing interest rates, fees, and other charges associated with its products.
  7. Regulated operations in multiple countries: They adhere to the regulatory frameworks of the countries it operates in, ensuring that it meets the local financial standards and provides a level of trustworthiness.
  8. Innovative Solutions: Being a fintech company, the company often leverages the latest technology to enhance its services, improve customer experience, and introduce innovative solutions in the finance sector.
  9. Customer Support: While their services are primarily digital, Ferratum also provides customer support channels, including live chat, email, and phone support, to address users’ queries and concerns.

What is Ferratum useful for?

These type of microloans can be helpful for a variety of purposes, such as:

  • Covering unexpected expenses: If you have an unexpected expense, such as a car repair or medical bill, a Ferratum loan can help you cover the cost until you get your next paycheck.
  • Paying for a short-term need: If you need to pay for a short-term need, such as a vacation or a new appliance, a Ferratum loan can help you quickly get the money you need.
  • Consolidating debt: If you have multiple debts with high interest rates, you can consolidate them into a single loan with a lower interest rate. This can help you save money on interest payments.
  • Building your credit history: If you have a poor credit history, a Ferratum loan can help you build your credit history by making on-time payments.

However, it is important to note that these loans loans are high-cost loans. The fees and interest rates are relatively high, so you should only borrow money from Ferratum if you are sure you can repay the loan on time.

How does Ferratum work?

To apply for short-term microloans, the cycle works as follows:

  1. Online Application: Customers can apply for a loan through Ferratum’s website or mobile app.
  2. Instant Decisions: Using automated processes and algorithms, Ferratum often provides instant or very rapid decisions regarding loan approvals.
  3. Loan Disbursement: Once approved, the loan amount is disbursed to the borrower’s bank account. The speed of this can vary, but with the emphasis on quick service, it’s often very fast.
  4. Repayment: Borrowers are expected to repay the loan by the agreed-upon due date. Interest rates and fees are communicated upfront, but they can be high compared to traditional loans due to the short-term and unsecured nature of the product.
Ferratum: how to apply for a loan in 2023

User Experience and Mobile App

One of Ferratum’s selling points is its quick online application process, which offers instant loan decisions in many cases.

Their mobile banking app provides a clean interface and user-friendly experience. The app allows customers to manage their accounts conveniently from their smartphones. Users can open a mobile bank account through their app, subject to verification and regulatory checks.

Customers can access a variety of services via the app, including fund transfers, transaction monitoring, mobile deposits, and more. Ferratum often provides a linked debit card to the mobile bank account, allowing users to make purchases, ATM withdrawals, and other transactions.

Feedback and improvement. Like many fintechs, Ferratum often uses customer feedback and technological advancements to refine and enhance its services, ensuring they remain competitive and customer-centric.

What are the requirements to apply?

Regardless of the country where it operates, the overall requirements are similar: being over 21 years old, registered in the country’s population registry, no debt against public debt institutions, plus some minor income in the previous year.

Here’s an example of what is required to apply for a Ferratum loan in Sweden:

  • ​​​​​​​Age limit of 21 years.
  • Declared income of at least SEK 24,000 in the previous year.
  • No debt balance with the Kronofogden in the last three years.
  • Registered in Sweden.
  • A maximum of 6 payment notes, and it must have been at least 6 months since the last note was paid off.

Things to keep in mind

Higher interest rates compared to traditional loans.

Understand the Terms. Make sure you fully understand the interest rates, fees, and repayment terms before taking out a loan.

Protect Personal Information. Always ensure you use the official website or app, and avoid sharing personal or financial information through unverified platforms or channels.

Customer Service

The company has a live chat option on its website and phone support to address queries and concerns.

Interest Rates and Fees

As is common with many short-term lenders, the interest rates can be considerably higher than traditional bank loans. This is due to the higher risk associated with unsecured lending. Some users might find the fees and interest rates steep, especially if they fail to pay back on time. It’s really important to read the terms and conditions thoroughly before applying.

In most cases, these loans can be beneficial, but it ultimately depends on the term you need the money for.

Representative example: In Sweden, for a total credit of SEK 25,000 for 12 months, the total amount to repay is 30,890.72 SEK (average SEK 2,574 per month). The effective annual interest rate is 53.31%. Account credit with a variable nominal annual interest rate of 43.49%. Other fees: Setup fee SEK 0.

Who owns Ferratum?

Ferratum Bank plc is part of the Multitude Group. Since October 2022, Ferratum Bank has been called Multitude Bank. But Ferratum is still the brand! In some countries, you will see it as Ferratum Money.

The Malta Financial Services Authority has approved the name change, which is reflected in its updated banking license.

About Multitude Bank

The change of name of Ferratum Bank plc to Multitude Bank plc follows a wider rebranding of Multitude SE, the parent company of Multitude Group, which before June 2021 was called Ferratum Oyj. The new name shows our unity and direct connection to the group. It was a natural step after the group changed its brand from Ferratum to Multitude.

Ferratum, part of Multitude group plc

Reputation: Is Ferratum legit and safe?

Ferratum is a well-established and safe financial institution that you can trust. It is regulated by authorities in all the countries it operates in, and adheres to the relevant financial standards and norms.

  1. Regulatory Compliance: Ferratum is regulated in the countries it operates in, which means it is subject to oversight by financial authorities. This ensures that the company adheres to standards and norms set by these regulators, enhancing its credibility and safety.
  2. Data Protection: Financial institutions, including fintech companies like Ferratum, must implement robust security measures to protect users’ data. This often includes encryption, two-factor authentication, and other security protocols.
  3. Transparency: A sign of a trustworthy company is its transparency about terms, fees, and conditions. They provides information about its services, though as with any financial product, users should read and understand all terms before proceeding.
  4. Customer Feedback: Checking customer reviews and feedback can provide insights into potential issues. While Ferratum, like many financial institutions, has received a mix of positive and negative feedback, it’s essential to differentiate between concerns related to high interest rates (a common feature of short-term loans) and concerns related to safety or fraud. Check Trustpilot for the latest reviews.
  5. Company History and Track Record: Ferratum has been in operation since 2005, indicating stability and experience in the financial services sector.

Ferratum vs. Other Lenders: What’s the difference?

Ferratum offers a very specific type of short-term microloan. There are other options out there, from credit cards, to overdraft accounts, to loans from big banks. What’s the difference?

From a general standpoint:

  • Compared to Traditional Banks: Ferratum’s interest rates are likely higher. Traditional bank loans, especially secured ones or those with longer terms, usually come with lower interest rates due to the decreased risk and the longer period over which the bank earns interest.
  • Compared to Other Short-term Lenders: Ferratum’s rates might be competitive, similar, or differ based on the specific lender in question. The short-term lending market is diverse, with many players offering varying terms.
  • Compared to Credit Cards: Some short-term loans can have comparable interest rates to or even exceed the higher end of credit card APRs, especially for cash advances or cards for those with poor credit.
  • Compared to Online-Only or Peer-to-Peer Lenders: Online-only lenders or peer-to-peer lending platforms might offer interest rates that are competitive or sometimes better than traditional banks. Ferratum’s rates might be higher or lower depending on the specific platform and the nature of the loan.

Conclusion: Is Ferratum Good?

Ferratum is one of the best and most trustable ways to get quick money right away with almost no paperwork and without ruining your credit history. If you happen to need money for an emergency or unplanned expense, Ferratum offers a great solution at flexible repayment terms, with no setup fees and transparent conditions.

Ferratum loans come at higher interest rates, so products might not suit everyone. If you need money for up to 5-6 weeks, it might be better to consider a credit card. However, applying for a credit card requires a credit check, can ruin your credit score, needs more income history, and takes longer to get.

Whenever you apply to Ferratum or similar services, ensure you fully understand the terms before committing.

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