While short term loans lenders have received an extraordinary amount of flak recently, especially in the media, the ability of ordinary people to be able to obtain short term loans when they want them may force society into accepting these loans companies as not only legitimate, but socially acceptable as well.
According to the Guardian newspaper, short term loans companies may soon overtake credit cards as a mainstream way of borrowing cash.
Payday loans UK, a major short term loans provider, thinks that the industry has been misrepresented in the media far too much and does a disservice to a service that provides many needy people with cash to tide them over for a short time.
One of the main reasons that so many people have turned to companies like Payday loans UK is because of the fast turnaround time in which loans applications are dealt with, the money requested being often in the borrowers bank account within an hour of the loan.
Many people who might originally have sought loans from banks or building societies have been unsuccessful and have turned to short term loans instead. The amount of unsecured lending by banks has actually declined by 21% between 2006 and the end of 2011, while payday lending has shown a corresponding increase.
Payday Loans UK was recently quoted as saying that, despite the publicity about high APRs being charged, that when people take out an instant cash loan for a short time only and pay it back, then the interest rates charged by instant cash loans companies are quite reasonable.
PaydaylOans UK says that most short term loans companies do state a warning about interest rate increases when people do not pay back their loans on time.
As long as the borrower sticks to the terms of the agreement, than the interest charged is not as much as has been constantly decried in the media.
An example quoted was of a loan for £200. If the loan was originally for a month and was paid back on time, then it would attract a 25% interest rate – no more than many of the credit card companies were charging, not that long ago.