Payday loan companies offering 'instant cash' face regulator crackdown
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Payday loan companies offering 'instant cash' face regulator crackdown
By LAUREN THOMPSON
Updated: 09:49 GMT, 21 December 2011
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Payday loan companies offering ‘instant cash' for Christmas shopping face a crackdown from the regulator.
More than two million people are thought to have applied for one of these expensive loans, designed to tide people over until their next pay cheque.
If you treasured this article so you would like to be given more info relating to Instant Cash Loan In 1 Hour Without Documents kindly visit our own web page. But the Office for Fair Trading (OFT) is preparing to swoop on firms that are luring vulnerable borrowers into taking out loans they can't afford to repay.
Out of funds: Many people apply for expensive loans when they run out of money before they receive their next pay cheque
It is concerned that payday loan companies grab money from customer's bank accounts without their permission if they fail to repay the loan on time.
This could result in the borrower being stung with overdraft charges or not having enough money left to pay essential bills.
More...
How to get out of debt
Christmas shopping will send a third of people into debt
And it says irresponsible advertising is targeting some of the most vulnerable people in society, such as the unemployed.
Transfers of cash in an hour have also prompted concerns that firms are lending without seeing if clients can meet repayments. The OFT's investigation is examining if firms are providing clear information on what happens if you can't repay.
It is also investigating 50 firms who pass on consumers' details to payday loan companies for a commission payment. These firms then cold-call or text people offering ‘instant cash.'
‘We have significant concerns about payday lenders and we are monitoring the market closely,' says a spokesman for the OFT.
A new service allows people to access their credit record for free — just as another firm has been slapped on the wrist for charging people £60 a month.
Your credit record lists every time you have applied for a credit card or loan, and whether you have missed any repayments.
It normally costs £2 to get a copy of your credit file from one of three credit reference agencies — Experian, Equifax or Call Credit. Or you can monitor your file online for £14.99 a month.
Now a new firm, Noddle, offers consumers access to their monthly credit report for free. It makes its money by advertising deals you are likely to qualify for, according to your credit record.
It comes as Adaptive Affinity Limited, the company behind QuickCreditScore, High Credit Score and Credit Score Matters, was warned by the OFT to clean up its act after thousands of people had unwittingly signed up to a service whereby they were charged up to £60 a month.
By LAUREN THOMPSON
Updated: 09:49 GMT, 21 December 2011
1
View
comments
Payday loan companies offering ‘instant cash' for Christmas shopping face a crackdown from the regulator.
More than two million people are thought to have applied for one of these expensive loans, designed to tide people over until their next pay cheque.
If you treasured this article so you would like to be given more info relating to Instant Cash Loan In 1 Hour Without Documents kindly visit our own web page. But the Office for Fair Trading (OFT) is preparing to swoop on firms that are luring vulnerable borrowers into taking out loans they can't afford to repay.
Out of funds: Many people apply for expensive loans when they run out of money before they receive their next pay cheque
It is concerned that payday loan companies grab money from customer's bank accounts without their permission if they fail to repay the loan on time.
This could result in the borrower being stung with overdraft charges or not having enough money left to pay essential bills.
More...
How to get out of debt
Christmas shopping will send a third of people into debt
And it says irresponsible advertising is targeting some of the most vulnerable people in society, such as the unemployed.
Transfers of cash in an hour have also prompted concerns that firms are lending without seeing if clients can meet repayments. The OFT's investigation is examining if firms are providing clear information on what happens if you can't repay.
It is also investigating 50 firms who pass on consumers' details to payday loan companies for a commission payment. These firms then cold-call or text people offering ‘instant cash.'
‘We have significant concerns about payday lenders and we are monitoring the market closely,' says a spokesman for the OFT.
A new service allows people to access their credit record for free — just as another firm has been slapped on the wrist for charging people £60 a month.
Your credit record lists every time you have applied for a credit card or loan, and whether you have missed any repayments.
It normally costs £2 to get a copy of your credit file from one of three credit reference agencies — Experian, Equifax or Call Credit. Or you can monitor your file online for £14.99 a month.
Now a new firm, Noddle, offers consumers access to their monthly credit report for free. It makes its money by advertising deals you are likely to qualify for, according to your credit record.
It comes as Adaptive Affinity Limited, the company behind QuickCreditScore, High Credit Score and Credit Score Matters, was warned by the OFT to clean up its act after thousands of people had unwittingly signed up to a service whereby they were charged up to £60 a month.
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