3 thoughts on “Ban payday lenders and the vulnerable will be forced to use loan sharks”

  1. Posted 07/03/2013 at 21:50 | Permalink

    Very good piece. Niall Ferguson recalls the case of a Glaswegian loan shark in his “Ascent of Money” who charged 25% interest per week, or roughly 100,000% APR. Pay day lenders provide an incomparable bargain. And you get to keep your health, of course.

  2. Posted 12/03/2013 at 18:51 | Permalink

    I feel there is a crucial point being missed here with regards to payday lenders, yes the loan is over a very short period of time, and the administration fee levied could be described as proportionate to the loan amount, however the real underlying problem is if the loan is not paid infull by the avreed tlme frame then another loan is taking out to stop them defaulting on the previous one. This process could and does go on taking people in to an ever downward spiraling debt cycle. The lender will continue to give these short term loans out knowing that the customer has no choice but to, to avoid default this cycle contin ues breeding debt because its in the lenders interest to continue with the debt cycle. This is where those hidious apr’s come in to there own for the lenders and should be capped. Lets not forget we do have a banking industry that refuses to lend to many people and businesses which has let the payday lending business grow and indebted many thousands.

  3. Posted 28/04/2013 at 20:54 | Permalink

    I am sorry but there is no justification in payday loans. They do trap you. The only people who have a real interest in them (excuse the pun) are the greedy lenders who see the opportunity to exploit the vulnerable. I admit I didn’t understand the consequences of taking such a loan and they weren’t clearly made by the fluffy advertising of the company I first used (nor the second or third companies I ultimately had to use to pay the first). If I had approached my standard creditors in the first place I would now have paid all debt. As it is with interest from payday loans and always struggling to pay off the fees and rates I now have two years of debt more than I would have had had I just contacted my original creditors and agreed a payment plan. Shame on you payday lenders. You should be banned.

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