Interest charges on short-term loans cause concern
23/02/09
A company in St Albans city centre started advertising personal loans with interest rates of almost 150% APR. This caused concern and local people have been warned about the over the top interest rates.
Payday loans with the value of £500 for thirty day duration are being offered at The Money Shop which is a national chain. The appealing factor of this loan is likely to be that the first £100 which is being advertised by the company as half price of the 149% APR. The remainder of the loan is payable at the normal rate.
“I really would like to bring to the attention of the public the extremely high rates of interest that are often charged by lenders who are not recognised banks,” commented Chris Oxley, District Councillor and retired banker.
He continued, “The interest charged on credit cards is already, in my view, very exorbitant but when we see supposedly discounted rates of almost 150 per cent APR it makes me shudder, as it is usually the less fortunate in our city and district who have to pay these horrendous rates."
“There is an organisation in St Albans called the Credit Union in Hatfield Road that will lend money at very significantly lower rates of interest and people who need money may wish to contact them or the Citizens Advice Bureau before borrowing from companies charging high interest rates.”
