Fraud is a major factor in the Payday arena. (You can not threaten to blacklist a person’s credit rating, if they don’t have one in the first place) many of the Payday applicants have no intention of ever paying a penny back. Only with a very experienced payday loan collections team is any Payday Loan Company going to have a future. Payment plans, (at £5 a month) are very rarely adhered too. Every week it is reported that many thousands of pounds of payday loan debt is sent to the courts, for attachments to earning. Only once the courts have failed to attach the payday loan to a clients earning, will it go on their bad debt list. Only 30% of payday lending goes to plan! But after lengthy payday loan collections and court orders, the default rate will stay just under 10%.
Hopfully this answers your question on why they are very high APR rate in the payday loan market.
Payday loan ping tress do not help the payday loan market, as the payday loan applicants are submitted to the payday lenders in turn, often multi propped and the payday loan applicants often get two or three offers. In desperate times many applicants will take out more than one payday loan, having to repay the payday loan back on their next payday. This results in the applicant defaulting or having no money to last the rest of the month, resulting in applying to more payday loan lenders and entering into a circle. There is no central data base for payday loan lenders so payday lenders do not know if the applicant has other payday loans or they are lending responsibly. Because the ping tree operator (webmaster) holds the applicants details, in many cases it is remarketed again and again a few weeks later. One resent example of the ping tree operator marketing data it had sold only weeks earlier was to a Debt Management Company, no less. (The Payday Loan Companies need a common database, which all Payday lenders subscribe too) and to insist that ping trees are abolished.
JST Financial only uses the market leading payday loan lenders, and we do not remarket your application for other products.
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