Payday Loans Under Global Review

Several countries have begun an in-depth investigation and review of the no credit check payday loan industry. This was spurred by thousands of complaints and reports of usury by the lending companies and their practices. United Kingdom’s Office of Fair Trade or OFT started this ball rolling.

The investigation will review the no credit check payday loan companies and how they operate. There will be checks to be sure none of these lenders are crossing the line and breaking standing laws and regulations. Investigations into how they are lending, such as no credit check. This could be deemed as irresponsible lending in many countries.

Aside from ensuring borrowers are not being taken advantage of, the results of this investigation will assist financial watchdog departments create new no credit check payday loans policies and guidelines. If there are proven instances of usury, these will be dealt with in the proper manner, such as fines, citations, licenses revocations, or closures.

One of the points of greatest concern for the investigative groups is just how the no credit check payday loan companies are dealing with delinquent borrowers. These lenders know these high Annual Percentage Rate (APR) loans are all but set up so he or she will fail and become more indebted to the payday lender, such as rollover or extensions. Many times the loans and all the attached fees and interest are demanded on the spot. Some payday loan companies even go as far the threatening to sue the borrower.

Another point of concern is the entire idea behind the no credit check payday loan. This means the lenders are not making sure their customer can even afford his or her loan in the first place. Many feel this practice is inviting those who are struggling financially to get even deeper in debt.

The other serious point under review is the no credit check payday loan companies advertising and marketing plans. For the most part, they seem to be targeting those in desperate need. The ads usually state how easy it is to get a loan for emergencies and/or to pay bills with the near instant cash.

These investigations are planned for online and brick and mortar no credit check payday loan businesses. Previous investigations have resulted in several U.S. states and several countries to make payday loan policies. Industry watchers are predicting the same will happen this time as well. Also, consumer advocacy groups are hoping for more change will result from the conclusion of the review.

 

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