Payday loan lenders in the UK will be forced to list their products on comparison sites. This is the new development in the payday loan industry writes Sean Farrell in The Guardian. This action has been encouraged by the Competitions and Markets Authority (CMA) following the claim that there is a lack of transparency in the industry. The CMA explained that borrowers currently lack the opportunity to truly compare the cost of such loans online and so comparison sites will allow for better competition and the chance for new lenders to offer better rates.
The Lenders List is an online comparison site that compares over 30 direct payday loan lenders. We are thrilled to offer a completely free service to borrowers where we will not share their details or pass them onto any other companies. The lenders that we feature on our website are all reputable lenders and we confirm that they have a valid consumer credit license and follow the regulation of the Financial Conduct Authority.
The CMA also recommended that lead generator websites selling potential borrowers’ details to lenders should be clearer about their activities. Many borrowers think the sites are lenders rather than middle-men and do not understand that they sell customers’ details to lenders for fees. This is something that we are very passionate about at The Lenders List. We only feature direct lenders and do not work with brokers. We are conscious that when customers are applying for loans that they do not work any unsolicited fees to be taken out of their account and therefore, we try to guide our users towards lenders they can deal with directly. To make this clearer, we also offer a guide on the difference between a lender and broker and how to avoid brokers.
Comparison could save borrowers up to £60 per loan
In an industry where the FCA estimated 10 million little loans issued worth £2.5 billion in total, the regulator along with the CMA agree that fairer and easier comparisons can be made between lenders. Although the new price cap being introduced in January 2015 will limit the daily interest to 0.8%, currently those borrowers who compare payday loans will be able to make savings of up to £60 on a typical loan.
The new price cap will include various limits on lenders to ensure that their default fee is no higher than £15 and to cap the rate at £124 per £100 borrowed so borrowers never pay double what they have borrowed. To understand this better, please find the video below explaining the new price cap in the payday loan industry and how it works:
The chair of the CMA’s payday lending segment, Simon Polito said: “Lower prices from greater competition would be particularly welcome in this market. If you need to take out a payday loan because money is tight, you certainly don’t want to pay more than is necessary. Given that most customers take out several loans in a year, the total cost of paying too much for payday loans can build up over time.”
The Lenders List is proud to be offering a free service to help borrowers in the UK save money when borrowing payday loans. For more information about each lender, please visit under ‘compare payday loan lenders’ and find all the individual lenders’ pages where you will find more information about the lender, their pricing and the checks that they run.