The Truth Behind Payday Loans and Payday Lenders in the UK

There has been much discussion in the news lately regarding the future of the payday loans industry in Britain. Let us help you to understand more about this tarnished industry.
By: Paydo
 
Jan. 2, 2013 - PRLog -- There has been much discussion in the news lately regarding the future of the payday loans industry in Britain. Marred by horror stories of massive interest rates, and accusations that the entire industry is rife with deceit and dishonesty the payday loans industry is under close scrutiny from the media and the government alike. We decided to investigate whether the payday industry as a whole is dishonest or whether, like with so many businesses, the actions of a few have brought the reputation of an entire industry into question.

One of the recent headline grabbing stories which we investigated was regarding a company having their licence revoked due to "deceitful and oppressive business practices."

Running under headlines which invariably incorrectly referred to “Yes Loans” as a payday loans company, readers learn that Yes Loans were arranging payday loans for consumers rather than the products they were initially enquiring about; deceiving them into thinking they were buying another product. Others were misled into believing the company was a loan provider rather than a credit broker, again falsely presenting themselves as another industry entirely. The company was selling payday loans as though they were an entirely different loan product and as such consumers who were mis-sold the loans were not able to benefit from them in the same way as if they had been properly informed of the loan’s fine print.

As a consequence of these findings we decided to investigate whether payday loans, if sold and managed correctly, were in fact beneficial to their customers.

Paydo.co.uk is one of the UK’s leading short term payday loans companies, priding themselves on being open and honest to their customers, being clear about the APR customers will face in an attempt to ensure that customers never borrow beyond their means.

Extortionate interest rates have been heavily focussed on in connection to payday loans, with many claiming that interest rates are unmanageably high. Paydo.co.uk is open and honest about their interest rates and explains how the use of Annual Percentage Rate (APR), which is often used to measure interest rates, gives a misleading representation of the true value customers pay, and in turn giving the short-term loans industry a bad reputation.  

Paydo.co.uk clearly states that “The rules and regulations that govern financial payday lenders state that we must show you the Annual Percentage Rate (APR) and our average APR is 1355%.” Unlike Yes Loans and many other payday loans companies who attempt to hide or deceive customers regarding the cost of the loan, Paydo.co.uk is open and honest about their APR but goes on to explain how the APR can often seem so expensive: “our payday lenders only lend for a maximum term of 31 days (one month), and so APR’s are not the best way to measure how competitive the loan rates actually are.” By looking at the Annual Percentage Rate the price seems enormous in comparison to the true price customers pay within the short time frame of a month the loans are taken out for.

We spoke to a representative of paydo.co.uk who said: “As long as payday loans are used correctly- as a short term loan until the customers next payday, and payday loans companies are open and honest about their prices like we are at paydo.co.uk, there is no reason the customer should not be completely satisfied with the service they receive.”

The payday loans (https://www.paydo.co.uk) industry is certainly one to be wary of on the whole, but as long as you are careful, and use a reputable website like paydo.co.uk where you can quickly and easily see the costs and the conditions you are bound to in claiming the loan, then the industry should continue to flourish and move away from the bad reputation it is being given.
End
Source:Paydo
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Tags:Payday, Loans, Lenders, Loan, UK
Industry:Payday loans, Financial
Location:Lancaster - Lancashire - England
Subject:Services
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