Yearly Report Shows Double Rise in Payday Loans
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There are several individuals who have borrowed payday loans are falling into serious debt issues. A report released from Citizens Advice Bureau has revealed that payday lending business has double in current fiscal year in compare of previous year. Reports also revealed that there is ten-fold increase in the number of clients who are seeking financial help to complete their fiscal requirements through multiple debt option which also include payday and logbook loans in last four years.
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According to past reports, in first quarter of 2009-10 only one percent of CAB debt to casework client had one payday loan. But major changes has been recorded in this area and it 4 percent of rise is recorded in payday loans. Ten percent of clients had at least one payday loan in the same quarter of this year. These figures are directly showing increase in payday lending. Experts say that it happens because of easy availability of payday loan on instant basis. They have also suggested that consumers should be away from such borrowing opportunities as these loans are available with higher rate of interest and strict repayment terms. Experts also suggest for other cash advance alternatives like overdrafts, credit cards or logbook loans for instant cash requirements to manage money at favorable terms and at lower price.
Chief executive Gillian Guy of Citizen Advice has said that quick cash payouts can have demanding consequences in long term. Reports revealed that payday loans are generally borrowed by the individuals who are already struggling with poor financial situation. Here, borrowing a new loan at higher cost can make the situation worst.
Experts also say that more people may go for payday loans with added cost of Christmas expenses. Credit bureau has advice that consumers should borrow money directly from their banker or use alternative borrowing option like logbook or personal loans.
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