Payday loans seem to be enjoying a rather high profile these days thanks to the league of TV adverts and numerous online marketing campaigns we are seeing every time we use our computers. But are the people behind these ‘helpful’ schemes actually aware of the financial difficulties that their client base are dealing with on a daily basis?
Britain’s personal debt crisis has also been in the headlines recently and a Channel 5 show about the problems we are facing attempted to include the payday lenders in the program. Essentially they wanted to discuss what these companies actually thought about the state of affairs that they seemed to be profiting from. Although a number of high profile politicians and celebrities were more than happy to talk about these issues on the Can’t Pay Debt Debate: Live program, it appears that the numerous payday loan companies had better things to do at the time and declined all requests to participate.
Not for the first time, a lot of bad feelings have been harboured towards these companies due to the fact that they appear to be enjoying a boom at a time when other financial businesses are tightening up resources. Perhaps they were only too aware that their high interest rates and lack of credit checking procedures would be called into question.
Why do people use payday loans?
The UK’s personal debt now stands at £1.4 trillion and is rising on a regular basis and families everywhere are struggling to meet their household bills. Payday loans companies offer a short term fix for this demographic, but there are consequences. With some of these loans hitting an APR of 5000%, you can start to see why they are prospering so fruitfully.
Theo Paphitis, former star of Dragon’s Den, has called for a nationwide cull on payday loan companies. He’s accused them of cashing in on the recession and has even suggested that if he were prime minister, he would definitely ban them.
The Channel 5 show also ran a poll made up of a cross section of UK families and the results were shocking. It revealed that 25% of this number would need a payday loan style rescue within one month if their salaries were withdrawn. Another 40% would manage for up to 3 months and 26% were worried about their personal debt situation.
Payday loans – good or bad?
Whilst it is probably true that these lenders seem to have a willing market, and first time customers certainly appreciate the ‘lifeline’ they are being offered, there is more to the whole story. These financial companies seem to be more than happy to offer their version of help, but are less concerned about the added debt that their customers seem to be taking on unwittingly.
If you are in financial trouble due to a payday loan or other borrowing, you can always come and speak to us at Dissolve Debt. We have been helping individuals and families with debt problems since 2004. As a family run business, we know how you must be feeling and have a team of friendly advisers waiting to take your call right now. Please don’t spend another minute worrying about your debt problems, and we are sure that we can tailor a debt recovery plan that suits your exact needs. So please pick up that phone and take that first step towards a debt-free future by calling Dissolve Debt today.