Payday loans firms - who funds them & how?

booktownman

Are they any financial experts out there who can explain to me who funds Payday loans companies & how - where do they get the money to lend to clients?


Is there any way the money trail can be followed?


Thanks in advance,


BTM

iolanthe07

booktownman wrote: »

Are they any financial experts out there who can explain to me who funds Payday loans companies & how - where do they get the money to lend to clients?


Is there any way the money trail can be followed?



Thanks in advance,


BTM

They are usually started by venture capitalists, who use the repayments (some) borrowers make to fund new loans. They justify their high charges because they lend to people with a poor record of paying debts, so they need to cover their losses. What do you mean by 'money trail'?

antrobus

booktownman wrote: »

Are they any financial experts out there who can explain to me who funds Payday loans companies & how - where do they get the money to lend to clients?

Depends on which PDL you're interested in. I believe that Wonga (for example) is funded by its shareholders. Other PDLs may have different arrangements.

VictimOfImpersonation

I must admit I was wondering about the answer to this question too when I listened to Wonga's Henry Raine giving evidence smugly to the Select Committee on Payday Loan Companies to the effect that they bought the larger part of the database they started with as raw data from CallCredit. I am not sure CallCredit's database is the most up to date but clearly it was the one Wonga most easily sided up to when they started and one wonders how or why that was so easy.

His smugness instantly had me thinking of wheels within wheels and it was clear from both that, and from the observed subservience of the others from the industry giving evidence, that they all would like carte blanche access to the very latest CRA data.

I liked Martin's throwaway near the end of his evidence that he has found himself extremely close to suggesting that the whole lot of them be banned (PDL co.s).

Clive_Woody

booktownman wrote: »

Are they any financial experts out there who can explain to me who funds Payday loans companies & how - where do they get the money to lend to clients?


Is there any way the money trail can be followed?


Thanks in advance,


BTM

I believe that mostly the money comes from Colombian drug lords, Somali pirates and of course Tony and Cheri Blair.

DCFC79

Clive_Woody wrote: »

I believe that mostly the money comes from Colombian drug lords, Somali pirates and of course Tony and Cheri Blair.

I thought the majority were funded by the russian mob and the rest by motorcycle gangs.

GazHatesBanks

Clive_Woody wrote: »

I believe that mostly the money comes from Colombian drug lords, Somali pirates and of course Tony and Cheri Blair.

Not to mention The Church of England (you know the anti PDL organisation!)

Clive_Woody

DCFC79 wrote: »

I thought the majority were funded by the russian mob and the rest by motorcycle gangs.

Don't they (the russian mob and motorcycle gangs) fund the Church of England.....so I suppose they indirectly fund PDLs.

gb12345

Clive_Woody wrote: »

I believe that mostly the money comes from Colombian drug lords, Somali pirates and of course Tony and Cheri Blair.

That is unfair - the Columbians and Somalis have scruples and wouldn't get involved with PDL firms.

Tony and Cheri, well if there's money to be made you can guarantee they'll have their snouts in the trough.

Clive_Woody

gb12345 wrote: »

That is unfair - the Columbians and Somalis have scruples and wouldn't get involved with PDL firms.

Tony and Cheri, well if there's money to be made you can guarantee they'll have their snouts in the trough.

My sincere apologies to the drug lords and pirates for grouping them in with the Blairs.

I feel very bad now....

DCFC79

Anyway, have any of you checked out the OP's first thread from 2011, he really didnt like the replies given so I imagine we will get the same response.