In the past, established financial institutions like banks accepted only immovable assets, like property, as collateral for loans. Using a movable personal asset to get a loan in South Africa generally involved having to approach a lender on the fringes of respectability, like a downtown pawnshop.
With the huge popularity of modern, asset-based loans, all this has changed.
Massive, global popularity of asset loans
Asset-based lending has been growing in popularity for many years. It has become a trusted and legitimate means of securing funds, especially with businesses and high-net-worth individuals who want to access the value of their physical assets without selling them.
Globally, asset-based lending was valued at more than US$560 billion in 2021. The market is expected to reach over US$1.7 trillion by 2031, growing at a compound annual growth rate of 12.2% from 2022 to 2031.
This value accounts for loans against both movable and immovable assets, but it still demonstrates how rapidly the industry is growing worldwide.
Many lenders find asset-based lending to be less risky than unsecured lending because a physical asset with a confirmed value secures the loan. This means the lender can always recoup the loan amount by selling the asset if the borrower defaults.
What’s attractive about loans against personal assets?
It’s easy to see why loans against personal assets are growing in popularity. These types of asset-based loans have many advantages over traditional bank loans.
Loans against movable personal assets don’t require you to divulge your income or submit any proof of employment, such as bank statements or payslips. The application process is simple and streamlined.
These loans also don’t have any effect on your credit score because they’re 100% secured by the movable asset. This means the lender won’t need to know your current credit score. Even borrowers who are blacklisted can get a loan with the right type of asset.
Asset-based loans are secured by a personal asset such as a vehicle, but the loan doesn’t affect your ownership as long as it is repaid in full. This makes it possible to use the value of your assets to access money without selling them.
If you need money in a hurry, these loans are very quick. They’re usually approved and paid out within a 24-hour period.
Examples of movable personal assets
Movable assets are any valuable possession that isn’t fixed. Movable assets include items like personal or business vehicles, gold, artworks, luxury watches, jewellery, and business equipment.
By contrast, immovable assets are physical assets that can’t be moved around. Immovable assets are almost always related to property, including land, buildings, factories and fixtures.
Business assets such as patents, intellectual property, trademarks, copyrights and brand recognition would also be considered intangible assets.
Getting a loan against a movable personal asset in South Africa
A growing number of accredited financial service providers now offer loans against movable personal assets in South Africa.
Lamna has been leading the market for asset loans in South Africa for nearly a decade.
- an accredited Financial Services Provider
- a registered credit provider with the National Credit Regulator (NCRCP7428)
- physical offices in most major cities in South Africa
- a range of straightforward funding options, including bridging finance
- a simple and transparent process, with no hidden costs or penalties.
Client borrows R10,000 for 90 days.
Total Cost of Loan
Fixed rates range from 36% to 60% APR and payment options range from minimum 3 to maximum 24 months. Apart from the initiation and monthly fees shown below, the only additional fee is credit life insurance if the borrower does not have this already.
You can use top luxury fashion brands in South Africa to get a fast, discreet loan without having to sell your precious item.
Asset loans are growing in popularity around the world because they provide a safe, simple and discreet alternative to traditional bank loans.