Ceska sporitelna’s Money by a click helps pay unexpected expenditures
A financial reserve that a client can use repeatedly at any time
The monthly repayment on Money by a click is fixed: always 5% of the credit limit
Free extraordinary repayments
According to the Czech Statistical Office, up to 40% of households in the Czech Republic do not provide for any financial reserve and then have problems paying unexpected outlays of CZK 10,000, which make a hole in their household budgets. That means that some 1.8 million families live from one paycheque to another. When basic expenses are deducted (food, rent, clothing, payments for school, etc.), they only have CZK 3,000 left. In that situation, paying for a washing machine repair or a surprising utility bill poses a big problem. Ceska sporitelna has therefore come out with a practical solution for clients – Money by a click (Peníze na klik), a simple loan for repeated borrowing of smaller amounts, a reasonable alternative to the microloans available on the market, which are not always advantageous.
“Our experience is that when clients are dealing with an unexpected expense and lack the funds to cover it, many of them do not consider carefully enough from whom, for how much, and how they should borrow. They neglect to read contracts and then take on disadvantageous loans. The most serious cases can end up at the Debt Advisory Centre. When developing Money by a click, we were inspired by stories of clients who did not have a sufficient reserve and were then put in an unpleasant situation by an unexpected expense, which they resolved under pressure and to their detriment,” said Veronika Benešová, Manager of Unsecured Loans at Ceska sporitelna.
The bank’s experience shows that people are not saving, and not putting money away for unexpected outlays. Ceska sporitelna advises them to put at least a small amount away every month, thereby creating their own financial back-up. “If they do not have it yet, we offer them an immediate solution in the form of Money by a click. The client chooses how much he is able to repay every month, and on that basis, we set the amount of the reserve he will be provided. The repayment should be an amount that will not burden the client’s budget, while allowing for rapid repayment,” added Veronika Benešová.
Aside from their personal account, clients have extra money available that they can borrow repeatedly without further paperwork. By signing one agreement, they gain a credit limit with a fixed monthly instalment, and by repaying the borrowed amount, they also renew it for future use. Money is available to them 24 hours a day, and they can transfer it to their accounts through Ceska sporitelna’s ATMs, SERVIS 24 Internet banking, the Mobile Bank application, over the telephone at the Client Centre, or in person at any Ceska sporitelna branch. It is purely up to clients how they use the money (whether they pay by card for a purchase in a shop, withdraw cash from an ATM, or pay an invoice by a transfer from their account).
The arrangement and maintenance of the Money by a click service is free of charge. Clients only pay when they decide to use the service (transfer money to their account) – CZK 50 for each draw-down (click). Repayments are always in the same amount, set at 5% of the credit limit. That means that clients know precisely how much they will be paying every month and can make provisions for those payments in their family budgets. An extraordinary repayment may also be made at any time, free of charge.
What is the place of Money by a click among other Ceska sporitelna’s lending products? For covering a month without an income, or to bridge the period between two paycheques, an overdraft facility is best. But its primary purpose is not to serve as a loan, but rather, as a back-up ensuring that all regular payments can be made from the account. It should be set at such a level that the client can repay it from a single paycheque. A credit card is, more than a lending product, a payment tool that is good for shopping on the Internet and abroad, or for clients who have got accustomed to it and are comfortable watching certain types of their purchases separately from their personal account. Money a Click Away is an ideal solution for situations when a client needs to finance an unexpected expenditure of around CZK 8,000 from time to time and does not have a sufficient reserve of his own. A loan (loan, consolidation, loan from Buřinka) serves for larger planned investments, such as household furnishings, the purchase of a new car, children’s studies abroad, home renovations, etc.
Details about Money a Click Away, including a model calculator, are available here. For more information, please contact the Press Centre of the Ceska sporitelna: