Lending Stream

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Representative Example: Representative 1286.98% APR on a loan of £300.00 with 5 monthly repayments of £101.03 Total amount repayable £505.13 Annual interest rate (fixed) 290%

 

This article is not intended to contain information about, or advertise, products offered by us but is intended to contain information, give opinions or discuss generally available products/services.

Author: Internal Marketing Department

 

Lending Stream is one of the more recent organizations to enter the payday lending industry and has since then been making a mark in this respect. They have been founded on the principles of trust, integrity and loyalty which are clearly defined in the way they manage their business and deal with their customers. Lending Stream felt there was a need to revamp the current system and replace it with a more efficient, trust worthy and customer friendly system which could work towards helping and guiding customers rather than serving their own self interests. This could properly be attributed to being one of the only major companies to have not made a profit, despite an increase in their workforce.

There has been heated debate over the various regulations and caps that need to be imposed on this industry. The Financial Conduct Authority has realized the need for serious measures to protect borrowers from the harm that the payday industry has caused them in the past. Let us discuss some of the reasons why there needs to be a stringent check on these institutions.

These loans are mostly being used by low income citizens in the UK and are replacing their existing source of income to pay for their daily needs. In other words, they are reaching out to a financially vulnerable demographic. A whopping 32% use these services for paying house hold bills, buying supplies and so on. Even though the industry claims to be catering to people who are in need of immediate cash in the case of an emergency, their advertising costs are being spent elsewhere. They are directed towards people who they know will be vulnerable in this era of financial uncertainty. Their ads appearing on children TV speaks for this. The effort is try to reach out to single parents or people with financial uncertainties who are living under self-imposed austerity measures.  

The statistics reveal for themselves how overly dependent these borrowers have become on these short term loans in order to subsist.

There is a difference between payday loans and cash advances. Although the traditional meaning of payday loans states they are cash advances, there is a difference between the two. Let us discuss payday loans first.

Payday Loans:

Payday Loans are generally referred so, because of the tendency for the funds to be borrowed and paid back in full on the borrowers upcoming payday. These loans are quick and easy and have try to use electronic validation rather than asking for lots of paper based proof (although this may be the case if electronic validation fails). These are usually used in the case of when your credit cards don’t have enough limit or if you don’t possess a credit card. Typical payday loans are between £100 and £1000.

Lending Stream is a well reputed lender specializing in payday loans and is considered as one of the leaders in this segment. They have been valued for their excellent customer relations and their collection methods have been an example to many.

Lending stream is also one of the organizations that spends time and effort in educating the customer about the various practices adopted by lenders in the industry. In addition to that, they also ensure that they are constantly asking for feedback for their services and spend more time and effort in understanding customer needs rather than cash in on their vulnerability.

They are also one of the lenders that are devoted to uplifting people from their current state of financial crisis into a more stable situation. This is how they indulge in these practices:

·       Their website involves different ways of saving money and managing your finances. It may not be the most effective way to communicate a message, but they are one of the few lenders trying to make a change.

·       Their customer relations are exemplary and their collection methods have also found to be far more customer friendly than the rest. They understand that someone can enter a financial crisis at times and are flexible in their repayment policies. Many times, they have agreed to reduce the repayment amount, if one is unable to pay the entire amount in a hurry.

 

Overall View:

It is an important responsibility of the lenders to understand the customers need and not take advantage of their uncertainty. Many lenders today have left the industry after facing strict regulations and it is a fight amongst the few for who can survive these enhanced regulations. It is also equally essential for a customer to be well informed about the lender’s practices and not indulge in any kind of default payment, as it can lead to serious implications and force them into a cycle of debt.

Representative Example: Representative 1286.98% APR on a loan of £300.00 with 5 monthly repayments of £101.03 Total amount repayable £505.13 Annual interest rate (fixed) 290%