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Need money fast?

It’s interesting to see the rise in high interest, short term loan sites.  I blogged about Wonga last year, and now there’s Quick Quid.

Here’s their advert:

Wow!

2356% APR!

That’s TWO THOUSAND, THREE HUNDRED AND FIFTY-SIX PERCENT annual interest!!!!

2356%!!!!!!!!

OK, it sounds bad … but it’s not.

Y’see these sites are designed for folks who are in a tight spot for a week.  Their monthly wages are coming in on Monday and it’s Thursday.  The rent’s due and they’re broke.  What to do?

Borrow the rent for four days off Wonga or Quick Quid.

Problem sorted.

These sites don’t encourage long-term borrowing as, if they did, they would be considered loan sharks which they are not trying to be.

As founder of Wonga, Eroll, puts it:

“Responsible lending is at the heart of our mission at Wonga. It means #1 being transparent.  Anyone dealing with credit card companies and banks knows the frustration of dealing with companies that aren’t transparent about what things really cost.  We’ve never had a customer at Wonga who has told us, after they’ve taken the loan, that they didn’t understand how much it was going to cost them, when they were going to be charged.  That has never happened.”

Even so, 2356% interest rates. 

Now then, if I could get you to borrow for a few months longer …

About Chris M Skinner

Chris M Skinner

Chris Skinner is best known as an independent commentator on the financial markets through his blog, the Finanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal’s Financial News. To learn more click here…

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