Payday LoansWho charges 3,650% APR – banks or payday lenders?

Following revelations on BBC’s Panorama television programme last week* that some banks are charging customers eye watering interest rates of up to 3,650% if they go overdrawn**, these banks may need to get their own house in order first before scoffing at perceived high APR payday loans.

So says industry expert Gary Miller-Cheevers (and CEO of payday loan company speed-e-loans.com), citing the television programme’s example of how if a Halifax customer went into an authorised overdraft with the bank by just £10 for 365 days, they’d be charged 3,650% APR**.

The shocking report also highlighted how banks make £2.6bn in penalty charges each year. It showed that though headline overdraft rates may be around 19% APR, once charges and other fees have been added in, a bank customer will pay an average of 32% APR for an authorised overdraft up to £500. For an unauthorised overdraft for the same amount, it could go as high as 165% APR.

Commenting on this Mr. Miller-Cheevers said: “It’s time for the banks to do what is morally right and be more transparent with their fees and charges, so that their customers can see exactly what they are paying for.

“The taxpayer spent nearly a trillion pounds bailing out the banks*, yet this is how they reward us – by charging outrageous fees and creaming off big profits for themselves.

“With our payday loan service, people can see exactly what they will be charged right from the outset, meaning they can make an educated decision as to whether a payday loan could be right for them.

“Certainly, a 2,334% APR may look high – though when compared to what some of the banks are charging, it is positively measly – but as the loans are usually for no more than a few weeks at a time, they can often work out very cost-effective.

“With an online small loan service like speed-e-loans, customers can set how much they want to borrow, can clearly see what the cost is, and time the repayment to coincide with their pay day. They can use us once and then use a competitor the next time. They are free to come and go. On the other hand, the banks thrive on putting fear into their customers that if they ‘mess up’, no other bank will take them, and then charge them outrageous and unclear fees for very minor overdrafts. The more people work out what’s going on, the better it will be for the consumer.”

One main advantage of payday loans is no credit check is required to be approved. This makes it easier for people to get quick cash, especially people with adverse credit.

Taking a short-term loan without having your credit checked can maintain your current credit rating as well. When you apply for most types of credit, a hard enquiry is made on your credit report. Depending on the number of times you apply, your credit score can decrease regardless of whether you are approved or declined. However, loans with no credit check don’t pull your credit and avoid this.

No credit check can also be helpful when you’re trying to borrow right before making a large purchase like a home or a car. Many experts advise people to “shore up their credit” prior to buying a large asset. This means keeping your credit card usage to a minimum and not applying for any new credit such as credit cards, loans, etc. But if you still need extra cash, a short-term loan could help. Typically, taking out this type of short-term loan won’t be recorded on your credit file (unless you default on repayments).

APR stands for annual percentage rate. Annual means one year. Thus APR is the cost of borrowing over the entire year.

However, APR is an annualised measure so it wasn’t designed with short term loans in mind. When you take out a payday loan from Make Today Payday, it’s typically for up to 1 month – not 1 year. The stated typical APR for payday loans in general doesn’t take into account that loans are usually repaid within 30 days, and not 365 days.

According to a Daily Finance article, the Office of Fair Trading (OFT) says APR is not always an accurate reflection of the cost of a loan. The OFT also points out that the Typical APR for a short-term loan is not necessarily reflective of the amount of interest actually paid. “A 2000% APR rate may actually be quite low,” explains the OFT.

APR is supposed to make it easier to compare prices. The trouble is that calculating the APR is so complicated. And all the figures floating around in the market confuse people. According to the same Daily Finance article, “the £2 pint of beer is now 5,370.6% APR.”

The average actual cost of payday loans is commonly £25 for every £100 borrowed. If a person borrows £400 over a term of 4 weeks, they would probably repay £500.

When you apply for a short-term cash advance, many lenders require you to have a valid debit card that is connected to your bank account. This makes it easier for you and the lender when it’s time to repay your payday loan. However, Make Today Payday understands that not everyone has a debit card. That’s why we provide payday loans to borrowers even if they don’t have a debit card.

Make Today Payday enables borrowers to meet unexpected expenses including medical bills, telephone bills, car repair costs, electricity bills and so on. To be eligible for payday loans without a debit card, borrowers need to meet some requirements. Generally, one must have regular employment for at least three months; earn a minimum monthly salary of at least £1,500; be 18 years old; and have a current bank account. If you can meet all these criteria, you could be approved for up to £750. Plus, approval is fast and easy since no credit checks are required.

The Office of Fair Trading spent almost a year examining the adverse credit lending industry, including rent-to-buy credit, pawnbroking, payday loans and doorstep lending. The findings were published in a report this week.

Its conclusion:

These markets work reasonably well in that they service borrowers not catered for by mainstream suppliers, complaint levels are low, and there is evidence that for some products, lenders do not levy charges on customers who miss payments or make payments late.

Make Today Payday offers short-term loans up to £750 to people despite their credit history. Therefore, people in need can have access to credit when they have nowhere else to turn.

Did you know that you can apply for a payday loan on the weekend and be approved for the loan by the next day, or in just a few hours in some cases? Because Make Today Payday does not require you to fax documents and does not disqualify you if you have bad credit, approval is quick and easy. Depending on your monthly income, you could borrow up to $750.

There are very few requirements for a cash advance – you must be a UK resident, receive steady income, be 18 years of age, and have a valid bank account. Cash advances are good for people with bad credit who can be approved since a credit check is not performed by lenders. Even though the loan amount is $750 or below, this amount of money can be quite useful when you need financial help in a hurry.

This type of loan is highly popular amongst lower, middle and working class families. Sometimes people encounter unexpected financial situations and need some extra cash. These types of loans can be especially helpful when you haven’t received your next salary and have no way to pay for the financial emergency. Payday loans are also helpful when you need to pay for expenses that can’t be paid with a credit card (i.e., rent or lease payments, credit card bills).

A secured loan requires the borrower to agree to name valuable assets which could be sold at auction to recover the outstanding debt if the secured loan cannot be repaid. If you secure a loan with personal property and default on your repayments, you could lose your collateral. What’s more is if you default and have your property repossessed, your credit score could suffer twice as badly.

But there is an alternative to secured loans – short-term loans!

Short-term loans are also known as unsecured loans, payday loans, cash advances, payday advances or personal loans. So what does this mean? It means you can borrow the money you need without offering your personal property to secure the loan.

Make Today Payday provides quick cash up to £750 with no collateral required. Don’t put up your home, car or valuables to pay unexpected expenses. Taking a payday advance allows you to keep your stuff safe from repossession. You could be approved instantly regardless of your credit history.

If you’re self employed and looking for a payday loan, you need to apply at MakeTodayPayday.co.uk. If you are self employed or have non-traditional income, it can be difficult to get approved for the cash you need. Well that’s not the case with Make Today Payday. We work with a large variety of lenders and financial service providers, so we are able to find and negotiate very competitive loans for people who are self employed.

Make Today Payday offers fast cash advances up to £750 within hours. Our self employed payday loans are ideal whether you’re a freelancer, a sole trader or you operate your own small business. You could be approved for an online payday loan no matter what your employment status, even if you have only been trading a short while, you can’t prove your income or earn non-traditional income.

Self employed payday loans can be used for any purpose, such as paying bills, going on holiday, or avoiding overdraft fees. Apply anytime by submitting Make Today Payday’s 100% secure online application. You’ll receive an approval decision in seconds. Then you could receive cash in as little as 1 hour, directly in your bank account. Loan applications are processed quickly and once approved the money is made available as soon as possible for you to spend as you wish.

All payday loan enquiries are treated on a “No Obligation” basis. No credit check is required. Therefore, if your credit history is tied to your own small business, you needn’t worry about anything. You can apply even if you have bad credit.

Soon, it will officially be summer and that usually means higher fuel prices. During the summertime, fuel costs are higher because of increased demand. More Brits are travelling and using petrol in the summer months. Hotter temperatures also force motorised vehicles to work harder and consume fuel at a faster rate.

With petrol prices on the rise, you may find it difficult to adjust your expenditure. However, you still need to fill up your car so you can travel to work and carry on as usual. So what are you to do until you can adjust your budget for increased fuel costs? In this case, a payday loan could help.

Payday loans are short-term cash advances that help bridge the gap between pay dates. When you face sudden expenses, you can take out a payday loan with Make Today Payday and receive cash in hours. The immediate financial relief provided by a payday loan allows you to get cash when you need it and gives you time to work out your budget.

What can you do when you need cash immediately? MakeTodayPayday.co.uk, the UK’s leading provider for direct deposit payday loans, is here to serve you. When you are short of cash, you can apply for a direct deposit payday loan from any location that has computer with an Internet connection. Avoid the hassle and delay of traditional brokers, and apply online for instant cash from Make Today Payday. With a same day cash advance, you can receive you money within hours.

You will not need to fax in any supporting documents to qualify for our overnight payday loans. We do not use traditional credit agencies to qualify you for same day cash either. Rather, we can instantly approve you for a payday advance based upon the information you include in your online application. Upon verification and approval, we can transfer your payday loan directly into your bank account. We offer direct deposit at no additional cost for your convenience, and will always treat your same day payday loan with high priority and urgency. With our great customer service, we pledge to treat you with the courtesy and respect that you deserve.

To receive your funds by direct deposit, you must have an active UK bank account. Direct deposit also makes it easy to repay your payday loan. Instead of having to remember when to repay, you can choose to have your payday loan repayment automatically debited from your account when it is due. This makes payday loans a quick, effective and easy way to get cash fast in the event of an emergency.