Monday, 10 January 2011


"Too many bills this month? Do what I did, visit and get the money you need today" so says the smiling actress on the television advert for QuickQuid.
According to the website, QuickQuid is 'helping hard-working Britons across the UK find a fast and convenient solution to immediate money needs from the privacy and convenience of home.'
Hard working Brits would need to work considerably harder if they take a loan from this company without first checking out the APR, an eye watering 2278%. That's TWO THOUSAND TWO HUNDRED AND SEVENTY EIGHT PER CENT. And let's not forgot the £10-£14 admin fee per every £50 borrowed.
While loan companies like QuickQuid make no secret that they are targeting the desperate and downtrodden, and make it amazingly easy to get the money, it does seem that they are exploiting the poorest of society, a conclusion that the Advertising Standards Authority deduced also when they banned the advert in 2009 for misleading advertising.
The ASA ruling stated: 'the ad should have displayed the typical APR in order to comply with the Code. In addition, because of the rate of the interest charged and the potential vulnerability of consumers likely to be attracted by the ad, we concluded that the ad was likely to mislead consumers by omission of information concerning the rate of interest.'
So now the television advert is back with the appalling APR displayed among the waffle at the bottom of the screen and directing you to the QuickQuid website where they boast the 'fastest and most hassle-free lending available.'
If you can locate the Privacy Policy link on the website (small writing beneath the login section if you are looking), you see QuickQuid is owned by CashEuroNetUK, LLC which is registered in Delaware, the corporate haven of America.
If you still need money to last you to payday and you feel yourself drawn by the smiling actress on the television urging you to do what she did, remember TWO THOUSAND TWO HUNDRED AND SEVENTY EIGHT PER CENT and there is always room for one more in the gutter.


The Ghost of Richard Nixon said...

Doesn't Great Britain have some form of usury laws?

Just asking.

Nog said...

I was wondering the same thing.

I ran the numbers. If you took out a 100 pound loan, and you had to pay 200 pounds at the end of the month, that would be a 4096% APR. A more realistic situation would be a two week payday loan. If you borrowed 100 pounds and had to pay 138 pounds back in two weeks, that would be a loan at a 2275% APR. I ain't saying that these are nice rates, but I'm assuming that these folks are selling very short term and/or payday loans. I don't know much about the payday loan market, but I would suspect that a 40% TWPR (two-week percentage rate) is in the usual range for such loans.

I don't think that the problem is that people are offering to lend other people at these rates. If I was some single mom and I was offered a choice between taking a 30-day loan at 150% (over 30-days) to pay my rent, or to see me and my children get thrown out on the street, I'd take the loan. I don't think that it is right for anyone else to say "we know what is good for you so we will prevent you from being able to get these loans; what's best for you is to not take a loan and to move your children out to live under a bridge until you can afford to pay your rent without borrowing." To me, that is far more disgusting than charging someone 138% for a two-week loan.

The problem that I see is that there are people who are so needy that they borrow at these rates. The solution is to find other ways to better these people's condition.


Nog said...

**Ehh... I think I did some of the math wrong and overestimated the rates by a bit. When you're dealing in short term loans, there's a big APY difference between having to pay back 120 for 100 and 130 for 100.

Lucy said...

Apparently we don't Richard Nixon but there is a call to have some introduced.

I really don't know how it works Nog and maths is not my strong point. To my simple mathmatical mind, if you borrow 100 and pay back 200, that 100% but its goes a bit haywire because then 2000%
on £100 makes it £2000. Nope, that's not right so i'm lost.

I do agree with you though that if people want to lend at these rates, then that is their look out
but it strikes me as strange that lending big money to people who can hardly afford to pay it back (and this is aimed at people with little to start with), then isn't that how we all got into such a financial mess in the first place?

Nog said...

On the math end, as I understand it, the APY is calculated on an annual basis even if the "term" of the loan isn't. So a one month loan of 100 that you have to pay back 200 (100 * (2.0 ^ 12)) for would be at least an order of magnitude higher than a 1 year loan that you would have to pay back 200 for 100 (100 * (2.0 ^ 1)).

Lucy said...

Easier and less troublesome to sell a kidney then Nog.

B Kershaw said...

At the end of the day there is only one looser when you buy money, and thats all you are doing! All of these pay day loan companies should be banned by the government! What chance does anyone have when companies cash in on peoples financial hardship! NO WONDER THIS COUNTRY IS IN THE SORRY STATE IT IS! To all of you people thinking of taking a pay day day loan do yourself a big favour... DONT GO THERE!

Lucy said...

I think the horrific APR's and the ease of getting the loan in the first place but then that's there bag isn't it, they want to make it as quick and easy as possible and then they got you.