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How has Coronavirus affected the payday loan industry?
Key points:
- Payday loan applications are down 65% since lockdown
- NHS staff are still the highest among those who are applying
- 70% of lenders aren’t taking new applications or reduced their loan budget.
So we have been busy analysing our data since the UK went into lockdown. Here’s the full list of our analysis:
- Loan searches – Down 40%
- Loan applications – Down 65%
- NHS staff are still topping the list of top employers who are taking loans.
- Rise in self-employed applying for short term loans – up 20%
- Average loan has increased by 16% from £250 to £290
- Short term cash – the main reason why people are applying.
- Around 70% of lenders are not taking new applications or have reduced their loan budget.
What does this mean?
I think the majority of us thought there would be a spike in payday loans during these uncertain times, however, it is the complete opposite.
I think the big reason for this is because people are spending less. Apart from online shopping and food, there isn’t much else to spend your money on.
Another factor is that whilst on lockdown, you can apply for mortgage holidays and pause other financial outgoings.
Will things change?
I don’t think anyone can give accurate predictions to any industry at the moment (well, apart from toilet paper and cleaning products) these really are uncertain times.
Finally,
Here at 1st Class Loans we hope you are all keeping safe and if you are in difficult financial situation, please don’t hide away, you are not alone. Please see our debt blog on what you can do and who you can contact to help you.
Name – John Wood
Bio – Finance writer for numerous financial websites. Studied at Manchester University.
Email – [email protected]
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