Payday advance lenders have redoubled their advertising efforts as of late in an attempt to market instant short term loans to those in need over the coming festive season.
The no credit check loans sector, which is subject to regulation by the Office of Fair Trading, has been under constant attack by traditional lending providers since their inception roughly 12 months ago. Despite the lack of support being given to the new lenders by the old guard, these purveyors of quick loans have been flourishing, with one such provider – Wonga – spending £11 million more on advertising efforts than they did last year.
Other lenders, such as Quick Quid, have also increased their advertising spending over the past 12 months, as research reveals their budget has doubled to nearly £4 million. The sector has been experiencing an influx of competitors, which has caused concern for payday advance detractors and debt counselors alike.
Centre for Responsible Credit chief executive, Damon Gibbons, accused many of these firms of making money on the backs of those who are already deep in debt and could go without taking another loan. Mr Gibbons instead remarked that these people in need should seek debt advice, yet industry experts say that debt advice won’t help to keep the lights on or the refrigerator stocked.
While traditional lenders may decry the fact that more and more Brits are resorting to no credit check loans for short-term credit, with so many households in the UK struggling with poor credit scores due to economic hardship and thus barring a High Street finance provider providing credit, British consumers have little to no choice but to avail themselves of this much-needed service in order to make ends meet.