Christmas cash loan - 183.2%

patrick1

I recently moved into a flat in a local authority block in London.

Over the past month everyone in our flat has each received four letters from Provident Personal Credit offering "Christmas cash loans".

"For just a few pounds each week you could have ...
£150 cash for just £4.50 a week
£300 cash for just £9 a week
£500 cash for just £15 a week

Typical 183.2% APR.

It's shameful how such companies repeatedly pester the most vulnerable people at at time of year when everyone is under such pressure to spend spend spend.

mandirinmonroe

the apr is awful ,but i suppose it is the only way a lot of people can get presents for their kids.

eldowardo

It makes good business sense to Provident. You have a business that makes a lot of money through their doorstep lending, and often these people who go for these loans have little or no income and rarely have bank accounts, so no credit rating or a very very poor one... but Provident will help you out by giving you this loan

sadly this is common in Council tenants. Also they wont realise the amount of interest they will pay on it. they see it as affordable, even though to someone with some financial literacy realise its a terrible loan!

Its terrible unethical - but its a way of life to a lot of people.

I could go on for hours on this topic!

tom188

Shock horror! How much would it cost to send a doorstep collector round for 8 weeks to collect £200 in instalments? Rather a lot id imagine and they will have to pass this cost on. I would imagine these loans are meant for the short term, making the APR irrelevant, although it must be quoted by law.

These loans have their place, and are probably better than resorting to a loan shark.

System

tom188 wrote: »

Shock horror! How much would it cost to send a doorstep collector round for 8 weeks to collect £200 in instalments? Rather a lot id imagine and they will have to pass this cost on. I would imagine these loans are meant for the short term, making the APR irrelevant, although it must be quoted by law.

These loans have their place, and are probably better than resorting to a loan shark.

Agreed.

And the price also reflects the risk that the lender takes, defaulting is a matter of course on these loans.

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