Personal loans can provide quick access to cash when you need it most. In today’s increasingly digital world, many lenders now offer personal loans through mobile apps. This allows Canadians to quickly and easily get the funds they require directly on their smartphones.

What is a personal loan app?

A personal loan app allows users to apply for and receive an unsecured personal loan entirely through a mobile application. The app acts as the digital interface between the borrower and lender, streamlining the entire loan process.

Some key features of personal loan apps include:

• Fast and easy application: Most personal loan apps only require basic personal and financial information that can be entered on a smartphone in just a few minutes.
• Quick approval decisions: Many apps provide an approval decision in mere minutes or hours through an automated underwriting process.
• Funds deposited quickly: Once approved, loan funds are usually deposited directly into the borrower’s bank account within 1-2 business days.
• Anytime, anywhere access: Borrowers can apply, check their application status, receive loan documents, and access funds all through the convenience of a mobile app.
• Competitive interest rates: Many apps advertise rates that are competitive with traditional lenders thanks to their streamlined digital processes.
• Transparent costs: All applicable fees, interest rates, and repayment terms are clearly disclosed upfront through the app.

By cutting out much of the paperwork traditionally associated with personal loans, these digital apps aim to simplify borrowing and get cash to Canadians faster than ever before. Let’s examine some of the top options currently available.

Top Personal Loan Apps in Canada

1. Borrowell

Borrowell is one of the largest and most popular personal loan apps in Canada, having approved over $3 billion in loans since launching in 2013. Here are some key things to know:

• Loan amounts: Borrowell offers loans from $1,000 up to $35,000, tailored to each borrower’s needs and repayment ability.
• Interest rates: Rates start at 4.99% and are determined by credit score, income, and other factors. Rates are clearly shown in the app before applying.
• Approval time: Most applicants receive a decision instantly through the app. Funds are deposited the next business day if approved.
• Fees: There are no upfront fees. Late or missed payments incur a fee of $25.
• Features: Borrowell’s simple and intuitive app interface makes it easy to check rates, get pre-approved, and receive funds. Advanced budgeting tools are also available.

Borrowell is best suited for Canadians looking for a quick personal loan of under $10,000. With flexible financing options, no account minimums, and one of the largest maximum amounts, it’s an excellent choice for smaller, immediate borrowing needs.

2. Neo Financial

Neo Financial is another leader in the Canadian personal loan app space, known for its fast approval decisions and straightforward digital experience. Here are the key things to know about Neo:

• Loan amounts: Loans range from $1,000 to $20,000, repayable over 1-5 years.
• Interest rates: Rates start at 9.95% and are determined through a soft credit check during application.
• Approval time: Most applicants are approved in mere minutes after a soft credit check through the app. Funds are available the next business day.
• Fees: There are no application, activation, or hidden fees. Late payments incur a fee of $25.
• Features: With an easy signup using a photo ID, Neo prides itself on a quick, streamlined application experience. Funds can also be used for anything.

Neo is best for Canadians who need a smaller personal loan for any purpose, approved very quickly through an intuitive app interface. It’s a great first-time borrower option.

3. Happy Loans

As its name suggests, Happy Loans aims to provide a stress-free borrowing experience through its personal loan app. Here’s an overview:

• Loan amounts: Happy Loans offers loans between $1,000 and $15,000, repayable over 12-60 months.
• Interest rates: Rates start from 9.95% and are determined through a soft credit check and affordability assessment.
• Approval time: Most applicants receive a quick decision within minutes directly through the app.
• Fees: There are no fees for prepayment or late/missed payments. A $50 account activation fee applies.
• Features: Known for its simple application and transparent fees/rates. Funds are deposited the next day after approval.

Happy Loans is best suited for Canadians who want a smaller, mid-range loan for up to 5 years through an affordable and transparent borrowing experience on their phone.

4. Lean

Lean is a newer personal loan app that has rapidly gained popularity in Canada since launching in 2020. Here’s an overview of what Lean offers:

• Loan amounts: Lean provides loans between $1,000-$15,000, repayable over 6-48 months.
• Interest rates: Rates start at 9.95% and are determined by risk score. Rates can be as low as 4.99% based on creditworthiness.
• Approval time: Most applicants receive an instant decision through the app after a soft credit check. Funds deposit in 1-2 business days if approved.
• Fees: There are no origination, prepayment, or late fees. A $59 account activation fee applies.
• Features: Lean stands out for its quick funding times and potential for lower rates than competitors. The app is easy to navigate.

Lean is well-suited for Canadians needing a mid-sized loan of a few thousand dollars, with the potential for more competitive rates based on credit profile. The streamlined app makes borrowing simple and transparent.

5. BestRate

BestRate is an established financial company that also offers personal loans entirely through their mobile app. Key details include:

• Loan amounts: Personal loans range from $1,000-$35,000 over 1-5 years. Larger loans are available through the broker process.
• Interest rates: Rates start from 4.99% for the best risks. Rates are provided upfront based on soft credit checks.
• Approval time: Decisions are provided instantly through the app for most. Funds will be available the next business day if approved.
• Fees: No application fees. Late fees of $25 apply. Early payout charges may apply in some provinces.
• Features: BestRate stands out for larger maximums and a clear multi-step application process. Can connect to bank accounts.

BestRate is well suited for Canadians needing larger personal loans of a few thousand dollars or more. The larger maximums allow flexibility for bigger borrowing needs.

How Do Personal Loan Apps Work?

Now that we’ve covered the top options let’s take a closer look at how personal loan apps operate from start to finish:

Downloading the App

The first step is downloading the app of your chosen lender from the Apple App Store or Google Play Store. This allows you to manage the entire borrowing process through your mobile device.

Account Setup

Open the app and create your online account by entering basic personal details like your name, address, date of birth, and SIN number. You’ll also be asked to submit proof of ID like a driver’s license, passport, or other government ID.

Application Process

Start your loan application by providing further financial details like your employment, income sources, and existing debt obligations. You’ll enter how much you want to borrow and your preferred loan term.

Most apps perform a soft credit check during the application to gauge your risk profile without impacting your credit score. This allows lenders to quickly provide rate options.

Decision and Funding

Many apps can approve your loan application instantly and put funds in your bank account the very next business day. For larger loans, it may take 1-2 business days to review your full file and deposit the money.

You’ll receive notifications through the app about your application status and approval. Approved borrowers e-sign loan agreements and disclosure forms right on their devices.

Repayment Process

You’ll set up automatic payments from your bank account each month to repay the principal loan amount plus accrued interest over the chosen term. Payments and balances can be easily tracked through the app.

Most personal loan apps aim to simplify borrowing entirely on your phone or tablet. This streamlined digital process allows Canadians to access quick funding more conveniently than ever before.

Key Things to Consider When Choosing a Personal Loan App

With so many personal loan apps available, deciding which one is right for your needs can be difficult. Here are some of the most important factors to consider:

Loan Amount

Consider how much money you need to borrow, and choose an app that offers loans in your required amount. Maximums range from $1,000 to $35,000 across different lenders. Apps with lower maximums may be better for smaller needs.

Interest Rates

Compare interest rates between apps and understand how they are determined. Rates start around 4.99% for the best risks but can be much higher depending on creditworthiness. Apps touting lower potential rates are ideal if you have good credit.

Fees

Look out for any application, late payment, or prepayment penalty fees. Some lenders have higher account activation charges. Choose an option with clearer or lower additional costs if possible.

Approval Times

If you need cash urgently, consider apps providing instant decisions or very quick funding. Traditional loans can take 1-2 weeks versus 1-2 days for approved digital applications.

Repayment Terms

The ideal repayment period matches your planned usage and income cash flows. Shorter terms involve higher monthly payments but less interest paid over time. Take these options into account.

Borrowing History

First-time borrowers may find apps doing soft credit checks more accommodating than traditional lenders wanting extensive history. This opens financing access.

Reviews and Reputation

Check app store ratings and online reviews from impartial sources. Leading lenders will have more positive feedback and fewer complaints about customer service or issues getting funds. Avoid new or unknown companies.

Safety and Security

Only use personal loan apps that protect your sensitive financial information with encryption, passwords, and two-factor authentication. Leading lenders are Certified B Companies audited annually for protecting user data privacy and security.

Choosing the right personal loan app means weighing these factors against your individual financial circumstances and borrowing needs. Take the time to compare a few options before submitting an application.

Let’s now examine some frequently asked questions about personal loans through mobile apps in Canada.

FAQs About Personal Loan Apps in Canada

1. What is a soft credit check?

A soft credit check involves a lender checking your credit profile without impacting your credit score. Soft checks allow personal loan apps to provide rate estimates during the application process without a hard inquiry affecting your creditworthiness. Hard credit checks lower your score.

2. How long does it take to receive loan funds?

For approved applications, most personal loan apps will electronically deposit funds into your bank account within 1-2 business days. A few may take up to 5 days for larger loans requiring further verification. Instant funding is not always possible due to banking processing timelines.

3. Can I use loan money for anything?

While personal loans have flexible uses, borrowers shouldn’t misrepresent their intended purpose in applications. Funds are best utilized for consolidating debt, home renovations, repairs, and other expenses rather than discretionary purchases like vacations which lenders prefer not to finance. Honesty is best.

4. How do I make repayments if my circumstances change?

Contact your lender through the app or by phone right away if you foresee difficulty making scheduled payments. Most will work on adjusting terms to avoid late fees or delinquency, but only if borrowers proactively request help. Ignoring payments harms your credit and can lead to collections.

5. What should I do if denied a personal loan?

Don’t take rejection personally – lenders consider many risk factors. If denied, ask for the specific reasons to understand where your application fell short. Wait several months and improve those areas, like paying down other debts, before reapplying. You may qualify for a smaller loan from another lender in the meantime while building your profile back up.

Through a combination of affordability assessments, realistic uses of funds, and open communication, personal loan apps make responsible borrowing simpler. Just be sure to only take on debt you have a clear plan to repay on time each month.