Unarranged Overdraft Charges May Be Headed Out

One of the most grievous charges payday lenders charge to their customers may be on its way out, if the FCA follows through on a proposed regulation. The FCA has been cracking down on payday loans for a long time now, and there have been talks recently, according to that unarranged overdraft charges are going to be targeted next.

These are charges that have not been approved by the borrower but are still perfectly legal. They are charges that are made in accordance with the lender’s agreement with their client, but many times, they are charged without the expressed consent of the borrower. Payday lenders make quite a bit of money with these unexpected charges, but their customers hate them.

Some of the largest lenders in the UK have already gotten rid of unarranged overdraft charges entirely. This is a move to position themselves as a customer friendly service and to get ahead of the possible incoming regulation. Lenders like Lloyds are making that move and appealing to customers by being more forward with their services and methods of operations. Customers appreciate lenders that treat them with respect and always ask before making a charge, but pretty soon, it could become mandatory that they operate this way.

The FCA has made at clear that it has no intention of keeping up the status quo for the high-interest lending market. The organization as a whole has continued to move legislation forward time and again as it enacts stricter rules for the industry. This is an industry that has come under repeated fire in the past for unscrupulous practices and methods of operation that are at odds with the best interests of consumers, and the FCA has made it its duty to crack down on his practices and to ensure a more customer friendly payday loan industry.

One of the biggest problems with unarranged overdraft fees is not that they are unarranged but that they are so much more expensive than payday loans, in many cases. These charges can completely derail a borrower’s repayment plan and make it very difficult for them to ever fully pay off the loan. This keeps them in debt to the lender for far longer than they anticipated, and that’s the kind of thing that the FCA is trying to prevent. Payday loans have long been seen as a trap for the financially unstable, and by targeting unarranged overdraft charges, the FCA hopes to get rid of some that stigma and make the industry safer for consumers.

They have been working hard to eliminate debt traps, and each new legislation they enforce seems to be geared toward that end. Most banks will alert their customers about overdraft fees visa email or text message, but it is not something that all payday loan companies or their customers, and the FCA may be working to change that in the near future.

Payday Loan Borrowers Now Enjoy More Competitive Services

New regulations for the payday loan industry are helping customers find great deals on loans. According to Sky News, lenders are being forced to prominently display links to websites that show how they stack up to other lender’s. They are required to link only to sites on which their company’s loans are compared to the competition.

This is meant to give consumers more choices and make them aware of how each company compares so that they can get the best deal. Lenders are already scrambling to put these new changes into effect, and it is having massive impact on the industry.

Now, lenders have to be aware of how they compare to other lenders in their area. They are having to change their prices to appear more competitive and modify the way they do business in a changing industry. This comes on the heels of price cap changes and other modifications to the regulations that govern the industry, primarily imposed by the FCA (Financial Consumer Authority). According to the Competition and Markets Authority (CMA) that monitors the payday lending industry and other financial markets, this new legislation can save consumers, on average, about £60 a year. That can add up to some incredible savings, epically for those who take out multiple loans year as a way to get by.

Payday loans have come under some scrutiny over the last few years for operating in ways that are not consumer friendly, and these new regulations can ensure that consumers are not taken advantage of. Overwatch committees like the FCA and CMA have noted that the reason many people fall into debt after applying for payday loans is because they are not aware of their options. They believe falsely that they are only eligible for certain types of loans because of their credit history or because of what a lender has told them. They may think they are getting a good deal, but then find out later that the loan costs far more than they realized.

Unscrupulous business practices within the industry is something that the FCA has been working to eliminate since it started targeting the industry, and it has made great efforts to make these payday loans a lot friendlier for consumers. This new set of regulations only furthers their goal of cleaning up the industry, and consumers have been pleasantly surprised with the advances in payday loans over the past few years. However, there have also been numerous complaints about lenders that offer these types of loans, and it goes to show that there is still a lot of work to be done. This is a step that should help consumers save money and find the best deals possible, making them aware of their many lending options. At the same time, it should help loans to become more affordable, as lenders now has to compete more directly with one another, and that can only be beneficial for the customers.

Payday Loan Caps to Remain in Place, for Now!

One of the most contentious issues plaguing the payday loan industry right now is that of caps on the loans. These caps have been addressed and changed again and again over the last few years. The Financial Conduct Authority, the industry’s watchdog group, has been regulating the loans and putting caps in place, and there has been talk about altering the caps once more. When asked about any upcoming plans to change the caps, the Financial Conduct Authority (FCA) resided by saying that it had no intention of addressing the caps further at this time. It’s focus, according to EuroNews, is on car finance, at the moment. After making the changes there it intends, the focus may shift back to payday loans, but it is certain that the FCA is not finished dealing with the payday loan industry.

The over-watch organization has been working for years now to make changes to payday loans and the way they operate, and they have made it clear that they intend to make further changes. However, each new change takes time and requires an adjustment period, so consumers simply have to be patient while the organization does its work.

Every time a new change like lowered caps is pushed through, it sends ripples throughout payday loan industry. Lenders have to change up the terms of their payday loans or shift the way they do business. Many of them have moved into the online space, since having physical retailers across the UK is no longer feasible for them. Many lenders have left the industry entirely, closing up shop as their efforts to stay competitive failed. The changes to the industry guidelines imposed by the FCA has simply been too much for some lending companies to handle.

The payday loan industry has been an area of particular concern for the FCA over the last few years. They have repeatedly targeted high interest rates and fees, drastically reducing how much lenders can charge their clients for services. The loan caps have been addressed multiple times already, and it’s safe to assume that they will be addressed again.

While payday loans are seen as an essential and sometimes beneficial service for the UK’s economy by many financial organizations, the way that many payday lenders go about their business and the way they sometimes target the underprivileged has raised the ire of the public on more than one occasion and spurred the creation of the FCA in the first place.

There is still a lot of work to be done on payday loans, and consumers can expect to see more changes in the near future, but for now, they have to be content with what has already been done there and the state of the industry as it is. Payday loans are now much more customer friendly and less expensive than they have in the past, so those who need the money they provide can do so relative safety and without worrying too much that they are being taken advantage of.

Transformation in the Payday Loan Industry

The payday loan industry doesn’t look much like it used to a few years ago. Where once lender’s shops lined the streets offering fast cash and bad credit loans, those have greatly diminished and been replaced by a move to the online space. In fact, the majority of payday lenders operate almost entirely online, which is a massive shift from where this lending niche was a few years ago.

There are also fewer lenders working the UK now, as many of them packed up and closed shop when new regulations hit and they could no longer remain profitable. Loan caps, interest rate changes and more forced many lenders to change the way they do business so drastically that they could no longer keep the lights on. Some tried their best to adapt and couldn’t make it in a changing world, and others folded up almost immediately, as the FCA started to crack down on illegal and unscrupulous business practices.

It all began in 2014, according to Finance Monthly, when the FCA started taking over the industry and regulating it as an over-watch organization. They imposed all sorts of changes and proposed many new ones that may have taken a while to take effect but have drastically changed the face of payday lending. Now, payday loans are geared more toward customers than ever before. Anyone looking for a payday loan is entitled to see what other companies offer when they look at the rates on one lender’s website. They are also entitled to full disclosure of the fees, rates and charges. The lenders have to be very open about what they are charging and when they will charge it, and that’s a far cry from where the industry was only a few years ago, when it seems commonplace for lenders to have all sorts of hidden charges.

In other words, the industry has changed for the better, as far as consumers are concerned. They have more advantages given to them and more confession being made for them. They don’t have to wonder what they will be charged for and how much it will be, because it is all made clear to them upfront. They also have easy access to lots of options like never before. They aren’t simply limited to whatever lender are nearby them, as they can access just about every UK lender just by going online, then quickly compare the rates to find who has the best deal.

Even the marketing aspects of the industry have changed, as Google has banned payday lenders from advertising their services on its search engine. There have been some serious changes made to the way payday loans are advertised as a whole. It’s a very different industry from what it was in the past decade, and consumers are benefiting from these changes. There are still a lot of lenders out there, and many of them do struggle to adapt to the times. Lenders still go under every so often, but it seems like new ones take their pace, as the industry is still a bustling one.

Understanding Debt Consolidation Loans and Finance Industry in the UK

Debt consolidation is unavoidable when you have too many debts or debts that you are struggling to repay. Many people wonder if debt consolidation is worthwhile, if one should consider it or just try to repay the debts as they are trying now. Truth be told, debt consolidation is the only option one has. Debt settlement is certainly an option but it can ruin your credit score. Also debt settlement is unpredictable and not a very easy solution for most people. After all, you don’t get an easy repayment plan. Every creditor or lender will not come together when you wish to settle. You would still have to repay the mutually agreed amount for settlement of each loan individually. Here is how debt consolidation loans and finance industry in the UK work.

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Don’t Underestimate the Impact of High Rates of Interest on Short Term Loans in the UK

There are times when financial challenges become overwhelming. It is in duress that people make poor decisions. When you have a financial liability that is difficult to manage, when you are failing to come up with a solution that works and when you need to resort to short term loans in the UK, you have only one thing in mind and that is to get over the financial hurdle. Most people are conscious of their decisions and do weigh the pros & cons of short term loans in the UK. However, there are many who tend to look at the prospect of using the money to resolve a crisis and in the process sign up for more than they can manage.

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Always look for the Simplest Payday Loans in the UK

Banks and traditional financial institutions are infamous for having complicated processes. Whether you are investing in some managed fund or you need a home loan, the process is painstakingly long and tedious. Most banks are trying to shed that image and some have succeeded to evolve and transform. Fortunately, private lenders and especially short term loan providers don’t have complicated processes. They are more upfront, flexible and considerate. One may point out to the fact that banks have a conservative or orthodox way of working, they have very stringent regulations to follow and they don’t like taking risks which is why discretionary powers are almost nonexistent in the best banks. However, as a borrower, you would want a simple process to get some money and not bother about the compulsions of institutions.

Payday loans in the UK are among the simplest to get. There is very little paperwork. Some lenders don’t have any paperwork requirement. The unsecured loans are readily available and you may even get approved in a few hours with some lenders. But these advantages are not a given. Despite easy procedures, there are some payday loans in the UK which will be complicated to get. There are definite reasons and you must understand them to make a better choice.

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There’s More to Loans and Finance Industry in the UK than Rates & Loan Amounts

Whenever we think about loans and finance industry in the UK, we tend to focus on relevant propositions, the loan amounts, eligibility and rates of interest. The four are indeed the most important factors. Eligibility is quintessentially relevant, the type of loan is a precursor to everything, the loan amount will make it suitable and the rate of interest will make a loan more favourable than other options. But beyond these, there’s more to loans and finance industry in the UK.

Let us explore some of the very important aspects of any loan, be it a home loan or a payday loan.

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When should you opt for Short Term Loans in the UK

There are many people who don’t like the idea of taking loans. They would rather access their savings, look for options to borrow money without paying interest and they may even deal with their financial problems in ways other than remedying them. Then there are others who would not hesitate to apply for some short term loans in the UK whenever they have a financial challenge. Loans exist to offer some financial help from time to time. We are not talking about home loans or business loans which would be enormous amounts. We are talking about short term loans in the UK, which mostly are a few hundred or at the most a few thousand pounds. Opting for short term loans in the UK is a perfectly reasonable way to remedy financial problems. However, they can backfire at times. It is necessary that every borrower takes a holistic view and makes a rational decision.

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A Few Words on Payday Loans in the UK

Occasionally you may find yourself in the position to need to take out a payday loan. Although this can be frustrating and worrisome payday loans in the UK are easy to find and easy to apply for.

Payday loans first originated in the United States. Since their introduction in the UK the amount of citizens taking out these loans has, according to recent studies, quadrupled. In 2009 the amount of money lent totaled £1.2 billion.

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