ChatterBank1 min ago
Do You Think That 'risk Warnings' On Payday Loan Adverts Will Make A Difference To The Volume Of Loans Being Taken Out?
Summary: Payday lenders could be forced to place "risk warnings" on their adverts to advise borrowers about the dangers of debt.
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No.
If people have run out of money, they will borrow rsgardless.
Everyone who takes them out knows they are a rip off, but they need some money. They make it easy.
If they want to deter these loans, they should have a 7 day delay from the application, to the money going into the borrowers bank account. The fact that they can now get the money virtually immediately makes the decision to take out the loan immediate.
If people have run out of money, they will borrow rsgardless.
Everyone who takes them out knows they are a rip off, but they need some money. They make it easy.
If they want to deter these loans, they should have a 7 day delay from the application, to the money going into the borrowers bank account. The fact that they can now get the money virtually immediately makes the decision to take out the loan immediate.
These companies provide a service which is needed. I wouldn't presume that everyone who uses them are thick. For instance, you used to be able to get a 'sub' working on site to cover digs, petrol, beer and other such essentials until you received your wages. Not everyone has a nice, steady job and/or lifestyle.
I'm sure many people 'take advantage' of these loans without running into any problems.
I'm sure many people 'take advantage' of these loans without running into any problems.
I think most users repay the loan soon after obtaining it. The rates of interest are high but not punitive on a very short term but are set high because of defaulters and that the company wouldn't make much at an annual 3% or so for a week. And, no, warnings about debt won't deter the public who are minded to use the service.
Mind, the more prosperous may use the service because banks are so brainless. I asked for a £1,000 'facility' for two weeks. This enquiry was transferred to some credit department which asked for a full statement of my assets and liabilities and that meet with a manager. Intrigued, I met her. She refused the money because I didn't fit the bank's criteria viz. I didn't have a regular monthly income. Now, I have 20 employees. I asked whether they fitted the criteria. Yes , they did, she said. "So they do, but the bloke who pays them their regular monthly wage doesn't?" I asked. She replied that she saw what I meant but the answer was still no because I didn't fit the criteria!
Mind, the more prosperous may use the service because banks are so brainless. I asked for a £1,000 'facility' for two weeks. This enquiry was transferred to some credit department which asked for a full statement of my assets and liabilities and that meet with a manager. Intrigued, I met her. She refused the money because I didn't fit the bank's criteria viz. I didn't have a regular monthly income. Now, I have 20 employees. I asked whether they fitted the criteria. Yes , they did, she said. "So they do, but the bloke who pays them their regular monthly wage doesn't?" I asked. She replied that she saw what I meant but the answer was still no because I didn't fit the criteria!
No it wont make a difference.
Agree with Gromit on the cooling off period, but i would go further and insist that they complete a standard risk assessment for each loan. anyone who does not pass a certain level but the loan is still given then the loan company should have no redress for the debt.
I do appreciate though that is may increase the illegal back street lenders but use the law to beat them (taxation laws could be used like on Al Capone)
Agree with Gromit on the cooling off period, but i would go further and insist that they complete a standard risk assessment for each loan. anyone who does not pass a certain level but the loan is still given then the loan company should have no redress for the debt.
I do appreciate though that is may increase the illegal back street lenders but use the law to beat them (taxation laws could be used like on Al Capone)
Fred, unfortunately you have fallen foul of the banks removing a proper Manager. The, usually, pimply youth only has a computer to tell him yes or no and computers don't have common sense. I have suffered similar problems when self employed, we were refused a £4000 temp loan when the Bank was holding over £1m of property that had easily 200K of equity!
However they do need some way of ensuring debt is not given irresponsibly.
However they do need some way of ensuring debt is not given irresponsibly.
I have been in the position where I needed money badly but the options were not there for me, I am glad to say. I just went without and soldiered over it. Believe me, I had to go hungry, I don't think that applies today. 'I am glad to say', because it meant I did not get into debt, but I feel really sorry for anyone who does because I understand the need.
For starters they should ban all Payday Loan TV adverts, and also put a ceiling on the amount of interest they are allowed to charge.
They should also apply a ban on all gambling adverts.
There are many young couples who can't afford the high deposits on houses, so they have to go without, why can't those who apply for such loans also learn to do the same?
They should also apply a ban on all gambling adverts.
There are many young couples who can't afford the high deposits on houses, so they have to go without, why can't those who apply for such loans also learn to do the same?
AOG
Although the interest rates seem exorbitant, you could argue that they are fair because of the very short term nature of the loan.
If you lend me £20 today, and I promise to pay you back £21 tomorrow - that would seem fair, however the APR would be eye-watering.
The argument I've heard is that these loans should never be more than for a few days.
Although the interest rates seem exorbitant, you could argue that they are fair because of the very short term nature of the loan.
If you lend me £20 today, and I promise to pay you back £21 tomorrow - that would seem fair, however the APR would be eye-watering.
The argument I've heard is that these loans should never be more than for a few days.
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