Understanding The Interest Rates And Repayment Terms For Employee Loans

Are you faced with a financial challenge and need a quick loan? Do you know that you can request loans from your employers as long as they are registered with Earnipay? What are the requirements needed for taking an employee loan with Earnipay? This article explains the basic requirements for an Employee Loan on Earnipay.

Many people face different financial challenges. Even the ‘best in spending’ sometimes face unplanned situations that require financial attention. These challenges include unexpected medical treatment, car repair, household emergencies, and other maintenance. These situations require urgent attention. Usually, it happens when a person is low on cash. You can’t decide not to pay your hospital bills, and you can’t choose to leave the damaged tap running. You need money to fix these situations.

Seeking traditional loans can be tiring, especially with the high interest. Another option for solving these financial issues is to seek employee loans which are way better than conventional loans in terms of interest rate and repayment terms.

What are Employee Loans?

Employee loans are loans provided to employees in an organisation by their employers to help them solve their financial challenges. It is a form of assistance by employers to their employees. The loans are usually repaid by deduction from the employee’s salary, and the amount that is loaned to the employee is calculated by the amount they earn.

With employee loans, an employee can access funds needed to fix their financial problems without the need to go through the stress of thinking of ways to pay back the loan.

How to Apply for Employee Loan on Earnipay

Applying for an employee loan on Earnipay can be done in these steps.

  1. Expression of interest in the loan collection by reaching out to HR.
  2. Your employer contacts Earnipay concerning your requested loan.
  3. Earnipay provides your company with an SLA/MOU to sign.
  4. You will receive the Individual Loan Application form to complete and submit through HR.
  5. Earnipay reviews your creditworthiness.
  6. Loans of up to 50% of your annual net salary will be available, with a 3% interest rate per 30 days and a maximum loan term of 12 months.
  7. Once Earnipay completes its checks and reviews, the loan will be disbursed to you.
  8. Your employer will then deduct loan repayments from your salary and remit them to Earnipay periodically.

What Documents are Required for Earnipay’s Employee Loan Processing?

  1. Confirmation of Employment letter.
  2. Valid ID cards (any regulatory ID plus Staff ID Card).
  3. A passport photo.
  4. Executed direct debit mandate.
  5. Completed and signed loan application form.

What is the Interest Rate for Taking an Employee Loan from Earnipay?

Earnipay charges a 3% interest rate monthly on every employee loan collected. For example, if you take a loan of ₦100,000 from Earnipay, at the end of 30 days, you will pay ₦3,000 as the interest. For your ₦100,000, you will be expected to pay ₦103,000 back to Earnipay at the end of 30 days.

What is the Repayment Policy for Employee Loans on Earnipay?

  1. Your company makes deductions monthly from your salary.
  2. On or before the second day of the following month, your company remits payment to Earnipay.
  3. The finance manager follows up for receipt or proof of payment.

Take Away

Employee loans are offered to employees by their employers to help them during financial hardship. With the help of Earnipay, employers can easily request loans for their employees, and the loan repayment will be deducted from their monthly salaries with a 3% monthly interest rate.

Earnipay provides services to ease the financial lifestyle of businesses and their employees. To learn more packages Earnipay offers employees, click here.

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