Credit Intermediaries: what they are, care and advantages of their services

Credit Intermediares are entities authorized by the Bank of Portugal to operate as credit intermediaries in our country.

The purpose of these entities is to establish a liaison between clients and banks. On behalf of clients, they request credit proposals from banks which they will then compare and propose, thus enabling their clients to research the market without actually having to do the work.

From the banks' perspective, they help filter the most promising clients and make it easier for them to access existing opportunities.

For the clients, the advantages are obvious. They quickly obtain a variety of proposals,both from their own banks and from their competitors. Normally, these entities have some negotiating power with the banking institutions and, as such, can obtain better terms than those that the client could get on his own. They are also used to the bureaucracy and paperwork required, effectively speeding up the whole process..

It is relevant to mention that there are different types of intermediation.The most common, the linked intermediation, is free of charge for the clients, since it is the Banks that ensure the payment of commissions. The non-linked type, on the other hand, is supported by the clienthimself, who pays for an independent service that is not linked to any Bank.

However, there are some precautions to be taken. These intermediaries can never grant credit directly, so whenever you see any intention or advertising to do so, you should not accept the service. They can never sign documentation or contracts on behalf of the client. There are also data protection issues. You should ensure that the Intermediary has such awareness and meets the conditions for the best handling of personal data as stated in the RGPD guidelines.