This particular question about payday loans has been asked thousands of times a day across the UK ever since the industry first emerged several decades ago. And what’s more, it has exactly the same answer as it did back then, which is a firm “Yes” with a “…but” following closely afterwards.
No exception to the rules
The thing about the payday loans industry today is that it is technically as safe as the consumer makes it. There will never, ever be a single industry anywhere in the world that isn’t open to abuse and corruption, at the hands of those looking to mislead the public for their own personal gain – a sad though inescapable fact. The payday lending industry is no exception to the rule, therefore while ever the industry exists, there will be those looking to exploit the naïve for their own benefit.
The trick, therefore, is knowing how to avoid them altogether – a mercifully easy ask with a modicum of common sense.
Nowadays, it really couldn’t be easier to smell a poor payday lender a mile away, or make a beeline right for the doors of the best in the business. The very fact that the payday loans industry as a whole is one of the most hotly-discussed and debated in the UK today means that it is impossible for any lender to get away with misgivings, as even the slightest hiccup will always be brought right to the attention of the nation.
Or to put it another way, each and every lender on the market has been stripped bare and laid out for examination in the form of consumer reviews, testimonials and write-ups on the web. There is literally no reason to ever enter into an agreement without a fully comprehensive view of exactly what to expect and when to expect it, with those at the bottom of the scale being flagged up for the dodgy services they are.
So, finding a reputable lender couldn’t be easier – then it becomes a case of handling the loan with care. A loan of £100 with a £25 charge is good value, nobody would argue otherwise. But, leave the loan unpaid and end up owing well over twice the amount borrowed and the loan suddenly begins to look sinister, but who’s to blame other than the borrower?
Why Do they Attract Such Criticism?
Of all the financial products on the market today, there isn’t a single one that comes close to the payday loans in terms of controversy and criticism. Ever since payday loans were first “invented” in their modern form in years gone by, the industry as a whole has been blighted by accusations of poor practice and illegitimate methods by which to capitalise on the weak and vulnerable. In fact, barely a day goes by when the payday lending industry isn’t brought up in one circle or another and chances are it will never be for positive reasons.
So, why all the criticism? Or perhaps more importantly, is it justified?
In answer to the first, the criticism surrounding the payday loan industry owes its origins to the Dickensian loan-sharking practices of decades gone by, when short-term lenders imposed ridiculous rate of interest and aggressive means of repayment pursuit. Given the fact that payday lenders are indeed short term lender, they share in the eyes of many the very same characteristics, when in fact this isn’t the case. True, when the industry first came about it was difficult to know which lenders were above board and which were to the contrary, but this is no longer the case.
Government regulations and general consumer expectations have grown to a point today where it is simply impossible for a payday lender to get away with offering poor service or ripping-off the public. There are countless websites that publicise the payday lenders’ involved as well as websites that feature payday loan news. Nevertheless, the criticisms continue even today, which in most cases originate from those that have either faced large debts after leaving their loans unpaid, or are simply buying into the hearsay and rumour.
In the case of the average UK payday lender today, each and every product is offered on the same basis whereby it has to be paid back in a set period of time and with a simple set of standard charges – usually £25 per £100 borrowed. If the borrowers repays as agreed, they will never face a single penny in charges more than this and the whole contract is close in a matter of weeks.
Problems only ever come in when a borrowers fails to meet the obligations set out, which just as would be the case with any lender will incur extra fees and charges. Payday lenders are businesses and just like every other business the world over must safeguard its cash assets, as to do otherwise would encourage vastly irresponsible borrowing and render the industry redundant.