Payday loan lender sees demand treble over Christmas
Demand for payday loans nearly tripled over the 2011 Christmas period compared to the year before, a payday lender has revealed.
Speedeloans said it made nearly three times as many loans over the festive period as it had the year before.
James Falla, personal debt expert at beatmydebt.com is unsurprised at the news.
"A combination of factors have lead to a higher take up of payday loans. One of the primary reasons is the increased advertising particularly TV marketing campaigns carried out by payday lenders in the run up to Christmas" he said
"However it is also clear that people have very little spare cash to spend at Christmas and when that ran out they turned to payday loans as other forms of credit are simply not available" Falla added.
Lower average debt
Despite the rising demand, the lender said its average customer had 30% less debt in December 2011 than the average customer in December 2010 – which it said suggested Brits spent the last year cutting down debts.
Average customer debt was down from £8,559 in December 2010 to £5,596 in December 2011, according to figures compiled by the firm, which said these debts were not related to payday loans.
The figures also revealed that compared with December 2010, the average payday loans customer was earning 3% more in December 2011 and had a better public credit score, suggesting they were a less risky prospect to lend to.
“This data seems to indicate that despite the recession, people are overall earning more and having less debt – all positive signs,” Gary Miller-Cheevers, chief executive of speedeloans said.
However James Falla is sceptical off this analysis.
"The fact that a number of doorstep and payday loans companies are saying that their average customers are earning more than a year ago does not necessarily mean that people have more money in their pockets.
Worse Payday Loan Companies - News
They are therefore borrowing from payday loan companies to make ends mean. Unfortunately where this is the case it just makes matters worse for them" he said. "If people are struggling to pay their bills becuase of high credit payments,
Cordray, the first director for the Consumer Protection Financial Bureau talks with The Associated Press about what consumers can expect on payday loans, student loans and other financial products. (AP Photo/Mark Duncan, File) A company's obligations
If the holidays or festive season is coming up, the situation becomes from bad to worse. Everybody wants to do something special for their dear one's but they fall short of cash. Payday Loan Solutions is drawing attention of lot of customers due to
It is important to check eaсh payday loans company fоr verification wіth the Better Business Bureau іn one's local area. If the company оne hаѕ chosen іѕ not registered, іt iѕ a good idea tо continue hiѕ or hеr search till hе or she haѕ found a
Steve Perry, author of the book When Payday Loans Go Wrong, says: "Lenders do not care about how or why people want a loan, nor if they can repay it, nor do they want people to borrow just the once as there is no real profit in it.
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