Payday Loan Help Forums
Payday Loan Help Forums
Top 10 Myths for Payday Loans
Since the payday loan market has entered the UK, it has come under much criticism from consumers and the media. However, it seems the same stories are appearing which can be described as the myths of the payday loan industry. In this blog, I will describe these top 10 myths and put forward an alternative argument to suggest why payday loans are beneficial to consumers.
- 1. Payday loans trap consumers in "cycle of debt"
Although the phrase "cycle of debt" is a favourite among industry critics, it is not based on the truth. Researchers and American state regulators consistently report that 70-80% of customers use payday cash advances between once a year and once a month.
Cash Genie, the short term loan provider, emphasises to consumers. It is important to understand that a payday advance is not meant to be a long term loan. What a payday loan has done is assist millions of families with emergency needs. This means that a payday advance is given only under the agreement that it will be paid off on the applicant's next payday (hence the term, payday advance). Cash Genie also operates a rollover service to help keep the payday advance applicant from being stuck in a long term, high interest rate loan.
- 2. All operate as loan sharks
A payday loan provided by a reputable payday loan or cash advance company, such as Cash Genie, does not take advantage of people. It is meant to be used only for a short term emergency situation by employed persons who need a little bit of help between paydays for emergencies. This is a very common occurrence when most families live pay check to pay check and may not be financially prepared for emergency repairs, travel or medical expenses. In reality, quick payday loans fill a necessary component in the economic world.
- 3. Rude employees
Payday loan companies do not compete on the price of their loan, therefore it is important for them to compete on other aspects of the service to create a competitive advantage. One of these ways is through customer service and Cash Genie ensure all employees are financially knowledgeable and are fully qualified for the job to certify their customers are given an excellent customer service. This is further enhanced through the recording and monitoring of telephone calls in and out of the company.
- 4. Target vulnerable people, the poor etc
Payday advances are marketed toward subprime clients without a distinction in employment or culture. In fact, payday loans are marketed toward those people earning between £10 000 and £25 000 per year. Most payday advance members are under 45 years old and all applicants are currently employed with a steady income and have an active checking account. In reality, payday advances are meant for working adults with an immediate emergency need that cannot be satisfied through bank and union loans.
- 5. Hide fees and have high interest rates
The payday cash loan facility is required by law to disclose any application fees, interest rates and other fees. In accordance with OFT guidelines, it is a legal requirement that all fees and rates must be clearly outlined and disclosed to the customer.
A payday loan does have high interest rates. This is not because the lender is trying to take advantage of emergencies, but because they are a short term lender. The payday loans are meant to be short term loans, not long term loans that are constantly refinanced with monthly statements. This means that the payday loan company assumes greater risk at the same profit level as other financial institutions.
- 6. Threaten customers with coercive collection practices
Cash Genie are committed to collecting past due accounts in a professional, fair and lawful manner involving no criminal actions. In accordance with BBCA's guidelines, companies in the UK may not pursue criminal actions against a customer as a result of the customer not repaying their loan. If absolutely necessary and after all other approaches have been tried, the lender may turn the issue over to a collection agency.
- 7. Operate outside the OFT guidelines
Short-term loan lenders, like Cash Genie who follow OFT guidelines and are dedicated to practicing all practices and collections in the best way possible. The company strives to educate the consumer and to make sure that our borrowers clearly understand the payday loan process. This is in accordance within the customer selection criteria in Cash Genie's Responsible Lending policy.
- 8. Unethical
Many posts have been written on consumer forums about how payday loan lenders are unethical and immoral for taking money from people who need it the most. This is not the objective of payday advances; these short-term loans are meant to tie over consumers until payday and be paid back on time. Cash Genie operate a ‘Responsible Lending' policy, listed in this policy are guidelines stating that Cash Genie's charges are transparent and only lend to customers who can pay the loan back. The company also offers a payment plan option if customers are unable to pay back the loan on time; this allows them to pay back a small amount per week which the customer can afford.
Short-term loan lenders who offer payday advances have also been seen to partner with a charity to match customer donations made through the website. Cash Genie UK have partnered with Starlight Children's Foundation to match the 50p donation, customers can choose to make on their interest payment.
- 9. Adds unauthorised charges to accounts
Payday loan providers only charge customers what they owe, and do not want to charge customers more for their loan. Cash Genie's ethical practices and responsible lending policy ensures customers only pay back the interest payments and charges which are relevant to their account.
- 10. Employees are trained to set hooks
Employees from payday loan providers are trained purely for business purposes, and to help customers as much as they can. Employees from Cash Genie pride themselves on excellent customer service and helping customers out. To employees from this short-term loan lender happy customers mean increase commission.
About the Author
Online Payday Loan Services: The Little Known Facts You Should Become Acquainted With
In today's environment, certainty on things that touch up on financial matters is a statement not based on facts. Why? It is simply because nothing is certain in this world especially on things that will definitely involve money. For example, no one is certain about the future that is why saving money is important. No one is certain about life; hence, nobody can foretell when accidents may happen.
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With all these uncertainties in life, money seems to be the most important factor in coping up with the challenges brought about by the ambiguities of life. For instance, accidents may happen anytime and if you do not have enough money to spend on hospital bills, you are definitely in trouble.
For this reason, lending institutions find it feasible to provide solutions to the growing money problems that consumers are facing nowadays. People are employed can avail of the many benefits that loan services can provide.
Today, many people are gradually realizing the benefits of online payday loan service. With the advanced potential of the Internet, people can now easily obtain payday loans online.
Online payday loan is one type of loan that provides financial support in small amount and in a shorter term for repayment. Since it is online, all transactions are made through the Internet.
Basically, with online payday loan service, you can easily obtain loans from a safe Internet website. Funds are generally deposited to the borrower's checking account in just a few hours.
Qualifications
Provided you are currently employed at the time you apply for an online payday loan service and have a checking account, you are eligible for the services. The good thing about online payday loan services is that these lending companies will not probe on your existing credit status. Hence, even if you have a bad credit, you can still acquire online payday loan services.
However, since most of the transactions are done online, it is best to take note of some very important reminders before submitting yourself to an online payday loan service. Here's the list:
1. Make some research
People know the kind of jungle the Internet has. You will never know your enemy or your assailant especially if you are not that knowledgeable about Internet transactions. Hence, it is important to research on the available Internet sites that provide online payday loan services. Try to investigate on the status of the company and if their site is secured. You can obtain some information through online forums or obtain testimonials from those who have already experienced online payday loan service.
2. Check the terms
Not all online payday loan services are created equal. Charges and interest rates as well as repayment schedules vary from one company to another. Hence, it is important to analyze and evaluate the fee schedules and finance terms related to your online payday loan service before you sign up for the services. Opt for the company that will best suit your needs and your capacity to pay.
3. Make a budget
A loan is a loan. Nothing can change that. Hence, even if they are easily obtained, online payday loan services do not serve as extensions of your financial resources.
Hence, to ensure on-time repayments, it is best that you set a budget. In this way, you will not be tempted to forego payments, which will eventually lead you to bigger debts.
Boiled down, online payday loan services can greatly solve your immediate money problems. Just remember these tips to avoid any further dilemma.
About the Author
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