Payday loans can help people in a number of different circumstances, particularly if you are experiencing unexpected expenses as a result of an emergency, meaning you need to find cash quickly to help cover costs. However, there are unfortunately certain myths that surround payday loans which can end up putting people off getting one, even when it may help them in their situation. One of these myths that surrounds payday loans regards how safe they are. However, it is completely false that they are not safe. In this article, we will explain how.
Payday loans are regulated by the FCA
The payday loan bad credit industry is regulated by the Financial Conduct Authority, which ensures that payday loans are safe. This is because all lenders and brokers have to adhere to a number of different policies and rules that have been implemented by the FCA, which affects the behaviour of how payday loan companies work. Some of the rules that are implemented by the FCA that the payday industry has to abide by includes:
- Making sure that there is a price cap of 0.8% per day, to ensure that interest rates remain fair to the customer, meaning that it will never be the case that the customer ends up paying more than double what they have borrowed
- Ensuring that payday companies are completely transparent in the information they provide to customers, prospective or otherwise. This means ensuring that borrowers are able to see exactly the amount they have borrowed, the terms and conditions of borrowing have been clearly stated, as well as the ways in which they are able to repay
Make sure that the company is FCA registered
If you are having doubts as to whether a payday loan provider is legitimate, it is well worth taking the time to check the FCA register to ensure that the company has been authorised as a lender, before deciding to take out a loan with them. If the company appears on the register, make sure that you are able to cross check the numbers that appear on the footer of each of the pages. Checking the register can be done quickly and online, taking just a matter of minutes through the FCA website. Simply type in the payday loans firm’s name or the postcode into the register in order to find out if they are authorised.
You can repay your loan early
It is worth remembering that you can always pay your payday loan back early if you are financially able to do so. This shows that payday loans are safe, as it also means you have the potential to save money on the amount you borrow, as by making early repayments, you will accrue less daily interest overall.
You can complain to the Financial Ombudsman Service
If for any reason you remain unsatisfied with the service you have been provided by a payday loan provider, remember that you have the support of the Financial Ombudsman Service, should you need to make a complaint. The services they provide mean that they can help you with any issues you may be having with a payday loan company and can help to resolve any disputes in a quick and informal manner between people and businesses. They are also completely independent, which means any decision they make is neutral. They also provide on their website a list of payday rights that consumers should know about before deciding to apply for a loan, which is well worth looking at.
We make sure that payday loan providers are safe
Payday Bad Credit is a responsible broker. We always make sure that any of the companies we work with to provide payday loans to our customers have been thoroughly vetted before allowing them to work for us, ensuring that they are both FCA authorised and have complied with their standards. To help you find the best lender for your needs, simply fill in our application online today and we will swiftly get in contact with you.