Lender advert regulations need to be changed, experts say

It’s time for short term loan providers to be regulated much more closely when it comes to their advertising campaigns, experts say, as as concerns about borrowers falling prey to misleading loan agreements.

Payday loan adverts are absolutely everywhere you turn nowadays. You can’t turn around without seeing an advert plastered over your television or your favourite website, and they all offer the same thing: instant cash loans with no credit checks and no waiting.

Sounds almost too good to be true, doesn’t it? Well, it will come to no one’s surprise that there’s always a catch to loans of this nature – a catch that is usually not expressed adequately in any of these lender’s advertising campaigns; the truth is payday loans come with hefty fees and hefty interest charges, which leave borrowers in the unenviable position of actually having to repay more to a payday lender than they would if they had taken out the same amount of money from a traditional lender.

Well, one insolvency trade body, R3, has had enough. Their newest survey indicates that consumers want to see more stringent regulations placed upon lenders in terms of what their adverts can and can’t say, said Chris Radford, R3 spokesman and Nottingham lawyer.

Mr Radford remarked that it’s quite difficult to ignore the siren call of payday lending as its currently promoted through slick television advert campaigns, especially with so many Brits suffering from budgetary constraints due to the sluggish economic recovery. The public wants better indications of how much repaying such a loan will cost them, the R3 spokesman said, and the trade insolvency body also called for better regulations to be made in order to force payday lenders to be more honest in their advertising campaigns.

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