A healthy crackdown is coming to London on the so-called “payday loans”. These are time loans that have literally depopulated in the United Kingdom over the past few years, when many have decided to take advantage of this credit channel which allows them to repay the sum collected, usually around one thousand pounds, when they receive their salary. Especially the bands that are in the greatest difficulty under the raging of the crisis, have taken advantage of this tool that is still not widespread in our latitudes to try to get by the best.
Credit in short time
Credit is usually provided in very short times, which can even reach ten or fifteen minutes in the case of recourse to the Internet, while the interest rate is very variable. Another advantage is the practical elimination of the bureaucracy usually linked to the provision of credit lines.
This particular form of microcredit is aimed above all at families that find themselves having to face sudden expenses, for example of a fiscal or medical nature, or to those that due to precarious or underpaid jobs fail to arrive at the end of the month. The important thing in all these cases is having a pay slip that can act as a guarantee. The interest rate applied however depends on the rapidity of the repayment times decided : the longer the repayment term is extended, the higher the rate applied by the financial operator.
Release payday loan
To push the executive to regulate the sector were in particular the increasingly aggressive sales tactics adopted by the operators, which often result in very high interest rates, even at the limits of the rate of wear and tear according to many experts. In fact, when the loan is not repaid in the terms provided for in the contract, interest is paid which begins to rise exponentially.
Rates that now would see the setting of a maximum daily ceiling of 0.8%, which would correspond to an annual rate that does not exceed 292%. For those who think it is too high a threshold, it is enough to remember that the one set by Wonga, one of the startups most reported for the release of a payday loan, currently stands at a dizzying 5853%. Doing practical competition with the actual loan sharks. Finally, it should be noted that according to some calculations, around half a million Italian families could be interested in a credit form of this type.
