Africa Bank Loan Review

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African Bank boasts a rich heritage in South Africa, tracing its roots back to 1975. Despite encountering challenging times, the company has emerged resilient and established itself as a renowned financial services provider in the country.

African Bank, operating in South Africa, caters to its customers with a diverse array of services offered through its extensive network of 390 branches across the country. Additionally, the bank ensures convenience by providing online access to its services. In this article, our focus will revolve around the two key offerings: personal loans and debt consolidation.

African Bank at a Glance

African Bank at a Glance

  • Loan amount: R2 000 – R350 000
  • Loan term: 7 - 72 Months
  • Interest rate: 15% - 24.5% APR
  • Initiation Fee: Included in APR
  • Monthly Service Fee: Included in APR

What You Should Know about African Bank:

African Bank describes its approach as "humanity through banking." Their objective is to consistently create innovative financial solutions that are both more beneficial and easier to access. African Bank provides a diverse range of financial services, with two of their most sought-after offerings being personal loans and loan consolidation.

Personal loans are well-suited for covering medical expenses, funding a wedding, purchasing a car, financing education, and various other common situations. Debt consolidation is beneficial for individuals seeking to simplify their monthly payments and potentially save money in the long term.

Pros of African Bank
  • African Bank provides insurance for your loans, ensuring that you are covered in case of unexpected events such as disability or retrenchment that may hinder your ability to make loan payments.
  • African Bank allows you to repay your debt in full ahead of schedule or increase your repayment amounts.
  • African Bank provides the option to take a payment break on certain loans, allowing for greater flexibility.
Cons of African Bank
  • The interest rates for personal loans offered by African Bank may be higher compared to those provided by certain credit providers.
  • African Bank does not allow their borrowers to buy credit insurance elsewhere. 
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*Representative example: Estimated repayments of a loan of R30 000 over 36 months at a maximum interest rate, including fees of 27.5% APR would be R1 232.82 per month. BetterLoans is an online loan broker and not a lender. Our service is free, and we work with NCR-licensed lenders in South Africa. Interest rates charged by lenders can start as low as 20% APR, including an initiation and service fee determined by the lender. The interest rate offered depends on the applicant’s credit score and other factors at the lender’s discretion. Loan amount R500 – R350 000. Repayment terms can range from 3 – 72 months. The minimum APR is 5%, and the maximum APR is 60%.

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How Do African Bank Loans Stand Out?

African Bank loans stand out for several reasons, offering unique benefits to its existing customers. One notable feature is the “Choose your Break” option, which allows borrowers to take a payment break on certain loans when they require additional flexibility in their budget. This feature will enable customers to allocate their financial resources towards other essential expenses, such as unexpected emergencies or planned investments.

Another aspect of African Bank loans is the possibility of saving through a consolidation loan. This type of loan enables customers to consolidate their existing debts into a single loan with a potentially lower interest rate. By paying off higher-interest debts through this consolidation loan, borrowers can effectively reduce their overall interest payments in the long run. This simplifies their financial management and could result in substantial savings over time.

African Bank Loan Products

Personal Loans

African Bank provides personal loans ranging from R2 000 to R350 000, giving customers the flexibility to borrow based on their financial requirements. The personal loans offered by African Bank have a fixed interest rate and include service fees and initiation fees, collectively known as the Annual Percentage Rate (APR). The APR for personal loans falls between 15% and 24.5%, guaranteeing transparent and predictable repayment terms.

Consolidation Loans

African Bank provides a debt consolidation service to its customers. Customers can apply for a consolidation loan of up to R350 000, which they can utilise to merge five loans into a single one. This has the potential to result in a reduced monthly repayment amount. The APR for consolidation loans from African Bank also falls between 15% and 24.5%.

Benefits of Taking an African Bank Loan 

When you take a personal or consolidation loan from African Bank, you have the option to insure your loan for an additional fee. You will receive coverage in various circumstances if you fall under category A customers. This coverage includes settling your outstanding obligation in terms of your credit agreement or facility and paying instalments towards your credit agreement in case of death, permanent disability, temporary disability, retrenchment, unpaid leave, or short time.

African Bank allows you to repay your debt before the agreed-upon term or to increase your regular payments. To do so, contact the bank to obtain the current balance due. You can save money in the long run by repaying your loan ahead of schedule. However, it is important to inquire about early payment fees to ensure this option remains cost-effective.

African Bank Loan Interest Rate and Fees

African Bank provides competitive interest rates on personal loans and debt consolidation loans, with an Annual Percentage Rate (APR) ranging from 15% to 24.5%. The APR represents the total cost of borrowing, including the annual interest rate and additional fees associated with the loan, such as service fees and initiation fees.

By offering a range of APRs, African Bank aims to cater to various customers with different financial needs and credit profiles. The lower end of the APR spectrum, at 15%, signifies a more favourable interest rate for individuals with strong credit histories. In comparison, the higher end, at 24.5%, may apply to those with less favourable credit scores. African Bank’s transparent pricing structure ensures that borrowers know the total cost of their loans, enabling them to make informed decisions based on their financial circumstances.

How To Qualify For a Loan From African Bank

In order to qualify for a loan from African Bank, there are a few requirements to fulfil:

  1. Age Requirement: You must be at least 18 years old to qualify for a loan from African Bank. This ensures that individuals in South Africa are legally capable of making their own financial decisions.
  2. Proof of Income: African Bank requires potential borrowers to provide documentation demonstrating at least three salary deposits, indicating a stable source of income. This allows the bank to assess your ability to repay the loan and ensures you have a reliable means of income to support the repayment obligations.
  3. Proof of Residence: Applicants must provide proof of residence to verify their current residential address. This can be a water and electricity bill or any official document stating the applicants’ name and address.
  4. Credit Check: African Bank will run a credit check on your name and ID number. If you have a poor credit history, African bank might not offer you a personal loan, but they could offer to consolidate your debts.
  5. Settlement Letters: When applying for a loan from African Bank to consolidate your debts, it is necessary to provide settlement letters for the outstanding amounts you owe.

How to Apply for a Loan From African Bank

The best way to apply for an African Bank loan is to use BetterLoans. In addition to African Bank, we request loan offers from other top lenders. You can easily compare and choose the best loan offer.

African Bank also operates around 390 branches throughout South Africa, ensuring their accessibility in almost every part of the country. If you want to apply for a personal or consolidation loan, you can visit the nearest branch and bring along the required documents. These documents typically include your South African ID, proof of income, three months’ worth of bank statements, proof of residence, and, if you’re applying for a consolidation loan, information on up to five debts that you want to consolidate.

If you are unable to visit a physical branch, there are still convenient options available to apply for a personal loan or loan consolidation. The online application process simplifies the procedure into five manageable steps. First, African Bank website and navigate to the African Bank application page. Provide the necessary personal information, ensuring accuracy and completeness.

Moving on to the next step, you will be prompted to enter your financial details, including proof of income and bank statements. It is crucial to provide truthful and up-to-date information to avoid any discrepancies or delays in the application process.

The third step involves verifying your contact details. This typically involves receiving a one-time pin or code via email or text message. This verification step ensures the lender that the information provided is associated with the correct individual, adding an extra layer of security to the online application process.

In the fourth step, you will receive a loan offer, which includes the Annual Percentage Rate (APR) and the repayment term. Take the time to carefully review this document, ensuring that you understand the terms and conditions and any associated fees or penalties. It is important to consider the affordability of the loan before proceeding to the final step.

Finally, in the last step, you will have the opportunity to accept the loan offer. Accepting the offer indicates your agreement to the terms and conditions provided. 

How Long It Takes African Bank to Approve a Loan

Loan approval from African Bank typically takes approximately 24 hours – 48 hours. However, if you opt to apply for a loan in person at any of their branches, there is a chance that you may receive a decision sooner, although it is not guaranteed.

Please note that in some cases, it might take up to a week for African Bank to process a loan application due to various factors.

Upon approval, the loan amount will be transferred to your designated bank account, usually within a few business days. It is advisable to retain copies of all the necessary documents for your personal records.

Is African Bank a Trusted and Reliable Lender?

Since its establishment in 1975, African Bank has emerged as a reputable and dependable lender, albeit with occasional challenges along the way. Over the years, the bank has built a strong track record, earning the trust of its customers and establishing itself as a reliable financial institution. In line with regulatory requirements, African Bank is registered with the National Credit Regulator, operating under the guidelines set forth in the National Credit Act of 2005. This ensures that the bank adheres to the necessary regulations and safeguards while providing its services to customers.

HelloPeter.com, a customer review website in South Africa, has given African Bank a low average score of 1.5 out of 5 stars, based on almost 7000 reviews. However, it’s worth noting that people tend to voice complaints more often than compliments, so the overall score may not necessarily reflect the bank’s overall performance.

African Bank Contact Details

Frequently Asked Questions (FAQs)

African Bank can take from 24 hours to one week to process an application loan.

African Bank runs a credit check when processing your application. If you’re blacklisted on any credit bureaus, African Bank will probably not offer you a loan.

Loan funds may take up to 72 hours to appear in your bank account after application finalisation.

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Foli Raheem

Foli has an MSc. Economics degree, and has been active in South Africa lending space for years. Whenever he is not writing, you will find him building websites.