An Overview Of The UK Payday Loan Industry

An overview of the UK payday loan industry

There has been very little research into the UK payday loan industry, partly because it was only introduced to the UK in 2009 and partly (based on an assumption) that there is simply not enough money on the government’s budget to continue to measure and monitor the industry.  Certainly more will be known by the end of 2012 following the Office of Fair Trading’s review of the market sector, however until then we can only base our facts on existing evidence, namely the report written by Marie Burton of ‘Perceptions of the payday loans industry in Great Britain’ which was researched and published in 2012.  Therefore, most of the evidence cited below is garnered from this report.

The popularity of the payday loan industry is largely attributed to the recession.  The increasing demand is mainly thought to be also because of the loans accessibility online.  Using statistics to predict the future of the industry has determined that it is likely to grow by a further 40 – 45% in the coming years.

The following companies have been identified as the payday lenders with the largest market share in the UK:

● Dollar Financial Corp (including The Money Shop and online provider Express Finance

(Bromley) Ltd)

● Mem Consumer Finance (trading as Month End Money, Payday Now, PayDay UK, Payday

Store, Quicksilver and Payday Loans)

● Cheque Centres

● CashEuronet UK LLC (trading as QuickQuid)

● Albemarle & Bond Holdings PLC (includingHerbert Brown & Son)

● H & T Pawnbrokers

● National Cash Advances

The average household income of a payday borrower varies and demonstrates potentially surprising results.  Almost 70% of loan users have a household income and the average amount of income is £24,492.  The complete synopsis of these results is as follows:

Under £15,499 = 46%

£15,499 – £24,999 = 21%

£25,000 – £39,999 = 20%

£40,000 – £49,000 = 7%

£50,000 – More = 6%

Approximately 50% of payday borrower’s are under the age of 35, and 60% are not married or co-habiting and most of this demographic do not have children.  Moreover, the most popular location for a payday borrower is either the North of England or Scotland.  In contrast to this the most popular location of payday lenders is either London or South East England.

This information is extremely interesting as it gives you a real insight into who a typical payday loan consumer is.  It dispels the myth that only homeless and destitute people request the loans as the average household income of a typical customer is over £24,000.