The small loan is also referred to as a small loan. It is a very low level loan, with two types of small loans. On youtube you will find a video explaining the essential aspects of such a loan under Simply explained: Personal Loan – Youtube.

The small loan as a microloan

A definition of a de minimis loan describes it as a loan that actually has the size of a de minimis loan and does not exceed a volume of EUR 200 or EUR 500. No formalities are required for such a small loan: a customer who is considered by his bank to be in good hands can usually exceed his credit limit by around EUR 200. Who has an already high disposition framework can also overdraw by EUR 500,-. Such a small loan is therefore basically a tolerated overdraft of the already granted credit line. If the customer has a regular and not too low income, the bank assumes that the small loan will lapse anyway with the next salary payment.
This type of small loan is usually used for very short-term purchases. It may also be the case that an invoice is deducted from the current account that exceeds the disposition limit at short notice. In any case, it is literally a baggage spot that should be forgotten within two to three months at the latest.

The Small Loan as a Form of Personal Loan

Another definition refers to a small loan as a private loan with an amount of EUR 2,000 to EUR 5,000. Of course, this is not a very high loan amount. However, it is considerably too high to be received virtually automatically at ATMs.
Such a small loan is granted quickly and unbureaucratically: Usually it serves to fulfil a short-term wish. This can be a holiday trip, a new car or new furniture. Since such requests often have to be paid for on the same day, the small loan is paid out quickly. On presentation of an employment contract and the last three to six salary receipts, the sum is transferred on the same day or directly at the bank counter.
As a rule, the self-employed do not have a permanent and permanent customer. Here it is sufficient to be able to document incoming payments of the last months in order to get the benefit of such a credit.
Banks usually also provide a small loan to people with a temporary employment contract. Despite the multi-year term of such a credit agreement, it is assumed that the customer will receive a follow-up agreement or find a new job. Low interest rates and good labour market prospects have made banks more flexible in lending than in the past.
A small loan is also often used to replace a overdraft facility. The low interest rate makes personal loans quite cheap. The low interest rate has so far not or only to an insignificant extent been taken into account for overdraft facilities. So you can save money here.
In principle, the issuing bank must obtain information from the Schufa. If the customer has a negative entry, the credit may not be granted. However, the banks have responded to the growing number of people with a corresponding entry: Most banks today have online subsidiaries based abroad. Since the German rules do not apply here, it is sufficient to send the employment contract and the incoming payments. A bank that would have refused the request for a loan at the counter will agree to this request online. For the customers this becomes somewhat more expensive, the sense of the Schufa however is questioned thereby. The Time national solo attempts are just over.