You need a personal loan to help finance a purchase. Nothing unusual about that as there are countless people who occasionally need a loan to purchase a car or fund a home extension or countless other reasons. However, the problem that you’re facing is that you don’t currently have a bank account and fear that you will find it difficult to secure a loan.
It’s probably worth starting by questioning whether there’s an alternative to getting a loan? Would it be possible to save up for a few weeks or months and buy the item that way? Loans are an expensive means of buying things, so for all people the preferred option is to avoid them.
Let’s assume though that you have considered this and concluded that a loan is the only option. It’s true that banks are unlikely to offer you a loan if you don’t hold a bank account. Loans need to be financed from another account, usually a checking/current account, so it’s not as if they are going to allow you to visit the branch each month to make a cash payment.
My first recommendation would be to apply for a checking account. Many people who don’t hold a bank account are in that position because they mistakenly think that a bank would never accept them. The truth is that many people who hold this view would be accepted, albeit that they might have to start off with quite basic account features. Even people who have previously been turned down would sometimes be successful if they applied again because they are now in a better job and are more mature.
In the UK, steps have been taken to ensure people aren’t disadvantaged by introducing what are known as Basic Banking accounts. All UK banks are required to offer these accounts and the way they work is that you get access to an account and a cash card but don’t get an overdraft or a debit card. This means that you can’t go into the red. The bank is safeguarded from the risk of bad debt and the person benefits from getting a foothold with the bank. If they manage their account well for a period of time, then they stand every chance of gaining access to additional financial products such as loans, overdrafts, and debit cards.
The advantage of taking out a loan with a bank is that the interest rates are usually better than what you could get with one of the many loan shark organizations. You might also want to consider opening a simple savings account with a bank. There should be no risk to the bank in giving you a savings account and again it’s a way of establishing a relationship with a bank.
An alternative might be to borrow the money from a friend or family member but this has some quite considerable disadvantages attached to it. Money disputes can ruin good friendships and you probably won’t want the stress that often comes with owing money to people you love.
There are of course organizations that specifically target people who have been rejected by banks. Such organizations, however, tend to charge high interest rates and sometimes have reputations for not being very scrupulous.