Personal Loans Lenders In Abundance

Despite the doom and gloom in the personal finance industry, it appears that a new bank has taken the market place by storm. According to research by the Post Office over £7 billion in Personal loans has been signed off by the new bank "Royal Bank of Friends" in the last 12 months.

There are more and more people asking their friends for help to boost their finances since the lending institutions and banks have become more stringent. It has been claimed by the people in the United Kingdom that just over 25% of people in the last 12 months have lent money to friends, the average loan amount lent stands at 𧴽 with the average lender lending to around 4 friends.

Of the £7 billion lent it is said that just under £3 billion is still outstanding and with 18% of lenders, lending more money than they can actually afford to, it is highly doubtful UK lenders will take on the lending plan the new lenders have. The figures of new lenders that have loaned out more money than they have the funds for is about 1 in 5, the figure for lenders that can't even remember how much they have lent out is very similar.

Doug Strachan the Post Offices director of finance said "Understandably, millions of households across the UK have needed to tighten their purse strings as the recession has taken its toll, and with money hard to come by from many lenders, people can be thankful that they have such good friends they can rely on."

I think it is safe to say that the traditional lenders will also not adopt the flexible payment options of the new lender, where the debtors have been imaginative in some of their repayment methods, to say the least. The more trendy options being; A thank you card, a meal out, some people will offer a favour in return, a kiss or a cuddle or even alcohol. Even though these unconventional reimbursement methods may be adequate among your friends, you can be confident that your bank manager may not be of the same opinion.

Although £7 billion represents a significant portion of the personal loans market as it stands currently, I do not think the industry needs to be too concerned about the new competition. There are plenty of new applicants out there too please the more customary lender, they are much happier to keep with the more traditonal terms, higher loan amounts, with a good repayment method and do not in return want you to take them for a spot of lunch.

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