[et_pb_section admin_label=”Section” fullwidth=”on” specialty=”off”][et_pb_fullwidth_header admin_label=”Myth-busters Header” title=”Myth-busters” background_layout=”light” text_orientation=”center” header_fullscreen=”off” header_scroll_down=”off” background_url=”” parallax=”off” parallax_method=”off” content_orientation=”center” image_orientation=”center” title_font_color=”#ffffff” custom_button_one=”off” button_one_letter_spacing=”0″ button_one_use_icon=”default” button_one_icon_placement=”right” button_one_on_hover=”on” button_one_letter_spacing_hover=”0″ custom_button_two=”off” button_two_letter_spacing=”0″ button_two_use_icon=”default” button_two_icon_placement=”right” button_two_on_hover=”on” button_two_letter_spacing_hover=”0″] [/et_pb_fullwidth_header][/et_pb_section][et_pb_section admin_label=”section”][et_pb_row admin_label=”row”][et_pb_column type=”2_3″][et_pb_text admin_label=”Myths & Realities” background_layout=”light” text_orientation=”left” use_border_color=”off” border_color=”#ffffff” border_style=”solid”]

Myth: Short term loans are the most expensive form of borrowing

Reality: Bank overdrafts can be one of the most expensive forms of borrowing. Banks can charge up to £30 for borrowing £100 through an authorised overdraft – a higher rate than the cap on short term credit.  When an unarranged overdraft is used, charges can reach up to £90 for borrowing £100 over 28 days, versus a maximum charge of £22.40 for a short term loan. [1]


Myth: Lenders lend to households on benefits.

Reality: Lending Stream customers must be in employment. 60% of all short term loan customers are male and the mean age of all customers is 35. More customers are full-time employed, rather than part-time. 37% of customers have a net household income of between £18,000 – £36,000. A further 28% have a net household income above £36,000. [2]


Myth: Customers don’t know what they are signing up for.

Reality: A study conducted by the Consumer Finance Association (CFA) found that the cost of a short term loan is much more transparent than a credit card with the exact fee displayed when taking out a loan. [3] 94% of Lending Stream customers say they would recommend Lending Stream and 92% of customers say loans from Lending Stream offer value for money.[4]


Myth: The industry is heavily criticised by its customers.

Reality: Consumer credit has a very low level of complaints. The top five most complained about products and services in 2015 H1 were PPI, current accounts, general insurance, credit cards and savings. [5] On the contrary, 94% of Lending Stream customers are happy with the service.





[1] Data drawn from Which? research, July 2015. The Which? press release can be found at:



[2] Competition and Markets Authority (2014), Payday Lending Market Investigation, Provisional Findings Report



[3] ‘Credit 2.0’ report, CFA, 2015



[4] www.reviewcentre/com/reviews232730.html



[5] Financial Ombudsman Data, 2015


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Becky Wheeler
(Director of Marketing and Communications)

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