Responsible Lending
What is a payday loan?
A payday loan is a small, short-term loan that is intended to cover a borrower’s expenses until his or her next payday. Typical loans are between £100 and £1000 and are due in two weeks.
Is a payday loan for me?
If used responsibly, a payday loan can be a great tool to provide assistance during a time of financial need. When choosing a payday loan company, there are two important things to keep in mind:
- It is important to choose a company that practices responsible lending.
- It is just as important to make sure you use a payday loan responsibly.
How do you practice responsible lending?
- Your first time loan will never exceed 30% of your net income. This is to ensure that you are not borrowing more money than you can pay back. Once you are an established customer, and have consistently paid back your loan on time your loan limit may be increased*.
- The real expense and debt trap for payday loans is when you rollover or extend your loan multiple times. The purpose of a payday loan is to provide a short term solution to a financial emergency – a payday loan should never be used long term. For example, if you are short on money and are in danger of bouncing a check, a payday loan may be a cheaper alternative for you. If you have to extend the loan or roll it over multiple times, your cost savings will be gone. This is why there’s a strict no rollover policy.
- They always send their customers an automated reminder email two days prior to their repayment date. This is to ensure that the loan is repaid in full to avoid NSF charges from the bank. Another reminder email is also sent to each customer on their actual repayment date.
- They’re always upfront about their loan fees. When borrowing from them you can always be assured there are no hidden fees or extra charges.
- Many payday lenders have been accused for “preying” on pensioners, people on disability, or military personnel. They will not enter into a business relationship with any of the following people: retired, on disability, receiving Social Security, paid only by commission, a substitute teacher, on maternity or medical leave, or an independent contractor.
- They take the utmost pride in ensuring our customers information is always kept completely confidential.
- They provide customer service representatives available to answer any questions or concerns twenty four hours a day – seven days a week!
What can I do to ensure I use my payday loan responsibly?
- Never use a payday loan for a long term financial challenge.
- Never borrow more than you will be able to pay back on your scheduled repayment date.
- Never borrow money from a company that doesn’t practice responsible lending.
- Always make sure you choose a company with superior customer service, and who puts your best interests first, before making a profit.
We strictly follow all Consumer Credit and Data Protection Act guidelines to protect our customers and their personal information.
*Based on your net income
