Lender says Government payday cap will encourage more borrowing
Mindful Money, 16 Dec 2013
As banks have imposed tougher lending criteria on borrowers since the financial crisis, payday lenders which specialiase in short-term loans, have seen their popularity soar but they have come under fire for charging extortionate annual interest rates of more than 5,000%.
The cap will be included as part of the Banking Reform Bill, which is in the process of going through Parliament.
But research from ‘alternative’ lender Amigo Loans has found that while the majority of Britons, at 84%, are in support of Government plans to introduce a cap, more than one in 10, at 12%, of 18-34 year olds believe they will be more likely to take out a payday loan once the cap is introduced, and 9% of them believe they would take one out anyway irrespective of the cap.
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