A new survey conducted by YouGov, an international research company, into the attitudes and opinions of people who were or have been short term loans borrowers has caused something of a stir amongst those most passionately involved in the debate about the role of short term loans companies.
The survey was actually commissioned by the industry association that represents some of the largest loans companies, the CFA, and it interviewed opinions from two quite different groups. These included 300 people who had been customers of short term loans companies and 300 who were representatives of government, like MPs, councillors and peers.
The survey revealed quite diverging views. Most of the short term loans customers seemed both to be quite satisfied with the service that they received and thought that the interest, fees and terms and conditions were clearly enough advertised to avoid any misunderstandings.
The survey also revealed that the average income bracket in which the short term loans borrowers belonged to was surprisingly high, at more than £4,700 more than the minimum wage.
John Lamidey, who is the CEO of the CFA, thought that the survey revealed what the CFA had been saying for some time about short term loans and the way in which they were sometimes misrepresented and misunderstood. He said that many people took out short term loans to “smooth out” their cash flow situation rather than take out a loan for a long period.
A blog piece in the Guardian newspaper, which is one of the newspapers who have been taking a keen interest in the short term loans ethics debate pointed out that the sample of people who had been surveyed, was not necessarily representative of short term loans companies as it had been sourced solely from a single company, The Money Shop.
The blog writer, for a finance section in the newspaper, said that The Money Shop, despite being chosen by the CFA as a typical example of a short term loans company was far from being typical, and it was a pity that the sample could not have been taken from a much larger spread of loans lenders. The writer said that the fact that the sample was unrepresentative meant that some of the findings were hard to take seriously.