The United Kingdom government has banned billboards and other kinds of advertisements from payday loans websites and the rules have been applied to some cities in the UK. Those websites are inaccessible since the regulation was firstly launched. The main reason is because the government wants to make sure their residents are free from ‘spiraling debt’. There are tons of popular websites, which are blocked, and it has caused on pros and cons. Some agree and others may find this very bothering because there will be a high-level limitation on customers’ choice. Is it effective enough?
The council insists that the existence of payday loans websites and their easy-to-approve policies have become a huge trap to many British residents. Based on recent research, there is an increasing number of people who are filing for bankruptcy as they have mounting debt from both their credit cards and other kinds of loans, including these payday loans. “Such cases cause high levels of stress and it leads to disaster on a family’s existence,” as the council said.
Payday loan business has been reaching its popularity in the past decade as people have been facing severe financial crisis. The firms that offer such loans apply high rates of interests though it does not stop people in taking them. This business is worth approximately two billions pounds in the country in yearly basis. The numbers of borrowers are fantastic as it reaches for at least five thousands of people in each city in the UK.
The existence of fast cash loans can be very helpful though some people may have misused them so that they are trapped into ‘everlasting debt.’ There are about ninety percent of British residents, who fail to pay back their loans. This is the main reason why the council has banned online payday loans websites from reaching their targeted clients. However, such rules are applied based on consideration for residents’ better financial future. As the main short-term lenders of trade association in the UK, The Consumer Finance Association apply certain standards for all borrowers. Its main aim is protecting consumers so not everyone can get easy approval for any loan like credit cards and payday loans.
Such regulations may bring better debt management for most people, but they remain controversial because many people find it harder to manage their budget properly. There are some workers, who do not get increased salaries and they have complained about the rising price of their essentials. Yet, let’s think about the positive side. At least, the restriction of some payday loans websites can avoid our desire to borrow money for unnecessary purposes.