One of the largest instant cash loan providers based within the eurozone has recently patted itself on the back for its market saturation, as a research study recently conducted by the payday advance lender claims that payday lending has become more and more important to Brits in order to help them ‘manage their financial affairs.’
Ferratum’s own resarch demonstrates that 52 per cent of their high interest rate short term loans are going towards paying unexpected bills, with the most popular being vet bills and car repairs. However, many other reasons given by survey respondents for why they sought out a high APR loan from Ferratum included making insurance payments or, in the case of one customer, to simply allow them to remain ‘afloat.’
Lending industry experts have been highly critical of payday lending, as the exorbitant rates and fees associated with the unsecured credit can prove to be highly unsustainable in the long run, especially if customers take out a series of short term loans over time. Ferratum’s customers are possibly in danger of such a fate, as the lender’s own research indicated that 7 out of every 10 of its customers have taken out at least two loans since last summer, when the lender launched in the UK – and some of these customers had as many as eight short term loans.
Sales and marketing manager for Ferratum UK, Ian Porter, commented on the new research, stating that payday lending has grown to become ‘an integral part’ in how Brits manage their financial affairs. While Mr Porter claimed that payday lending provides a secure, efficient, and fast way for Brits to meet short-term money needs, many debt relief charities have had strong words for the payday lending industry, refuting its claim that unsecured lending is a ‘responsible’ choice for those in need of financial advice.