Misunderstanding of Payday Loans
Posted on May 16th, 2012
Misunderstanding of Payday Loans
93% of customers think payday lenders treat them with dignity and respect said a survey by the Consumer Finance Association (CFA).
According to a survey by the CFA, it doesn’t matter how much interest is charged for a payday loan, provided you are treated with dignity and respect. “One of the largest ever pieces of research into the payday loan industry, conducted by international research agency YouGov, has revealed a massive gulf in attitudes between payday loan customers and politicians” claims the CFA, a trade association which includes several payday lenders among its members, showing that payday loans can be “misunderstood”.
93% of payday loan company customers think payday lenders treat them with dignity and respect, whereas only 5% of policymakers think they do so. 89% of customers think payday lenders explain their charges and fees clearly, whereas only 12% of policymakers think they do, found the survey.
However, when conducting the survey YouGov was careful to question a variety of policy makers, but the 300 payday loan users it questioned were all customers of just one company, The Money Shop – one of the biggest and more reputable high cost loan companies. The results of the survey would probably have been different had the sample been extended to customers other companies, including those having lost their licence following the Office of Fair Trading investigation into customer complaints.
YouGov were provided with the contact details of 3,600 Money Shop customers, from which 300 were randomly selected said a spokesman for the CFA, the Money Shop was chosen because of its size and high profile.
The way the survey was conducted raises issues of how representative of the industry the research is.
Story by Fresh Start UK
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