Pacific Odyssey Loans

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Pacific Odyssey Loans
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Payday UK is one company that is considered as
one of the most premium payday lenders in the
world. They are one such company that have been
instrumental in understanding the need of
borrowers and arriving at methods to be able to
tackle the problems that most of the borrowers
are facing today. In addition to this, their debt
collection practices have known to be at par with
the new regulatory framework that is slowly
coming into practice today, which has led to
great borrower confidence. In an industry which
is notorious for high interest rates, horrible
debt collection practices, it has become an
imperative for more responsible lenders to join
the industry and work towards the overall
upliftment of the general public.
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Most store front payday lenders charge a fee that
ranges between 10-20 pounds for every 100 pounds
that you borrow. This is a standard market rate
that has been set by these institutions and it
can vary depending upon the state in which the
payday lender functions. There are a few states
which have higher or absolutely no limits which
depends on the loan size. The borrower income is
an important consideration in payday loans, as a
lot depends upon the demographic of people who
are coming out and applying for a loan. A
majority of the payday lenders have claimed that
they have people with an income range of
10000-40000 pounds on an average.
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It is also important to understand that this
income doesnt reflect the entire household
income. There could be other sources of income in
the household and this holds true for a large
number of people applying for a loan. It is
important to consider the intensity of use, in
the hands of the borrowers. What their pattern of
buying a loan is, how often they are looking for
a loan. In this consideration, it is also
important to consider that even a roll-over of a
loan is considered as another loan.
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There have been various studies to suggest this
level of activity amongst the borrowers and this
can be seen with approximate figures depicting
these patterns. Close to 50 of the borrowers
have more than 10 transactions over a certain
period of time, 29 had more than 20 transactions
and a vast minority has about 1-2 transactions.
This clearly shows the immensity of the
situation. People have become increasingly
dependent on these loans and it is being shown
through studies such as these one.
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The default charges and the high interest rates
are what are causing the borrowers to roll over
the loan which in turn is forcing them into the
cycle of debt. This also depends on how
frequently the borrowers are paid. The people who
arent paid as frequently tend to take out fewer
loans as they dont have a stable source of
income. The people who are frequently paid tend
to take out more loans than the rest. This is a
common phenomenon which is impacting regulations
all over.
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There has been a concerted effort by payday
lenders to dodge the reforms that have been put
into place and this has led to major players
leaving the industry as a result of that. There
has been a considerable amount of subterfuge in
this regard where the payday lenders position
themselves as brokers. This enables them to
charge the maximum interest rate along with the
broker fee which compensates for the amount of
money they are losing out on, if they dont deal
in payday loans.  This particular practice
increased drastically after 2005. In that same
year, there was a crackdown by regulatory bodies
like the Financial Conduct Authority who were
tying up with national banks to avoid consumer
protection laws and function on their own free
will.
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Despite many payday lenders claiming the high
interest rates for their functioning, there is no
law that clearly states that the payday lenders
are allowed to lend at triple-digit interest
rates which could be one of the main problems,
since nothing has been clearly defined up till
now. If anything, there have been laws which have
been responsible for de-regulating the industry
like the Monetary Control Act of 1979.
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Although there are several payday lenders in the
industry today which are functioning under
different names and many of them carry a great
amount of goodwill in the market, the license and
the label which they carry is not as important as
the high interest rates and the balloon payments
which are due on the borrowers next payday.
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It has also been observed that there are many
direct lenders which are selling under a third
party where there is no law governing their
functioning and at the same time, the debt
collection practices are also being leased out to
a third party where it cannot be linked back to
the direct lender and as a result of this, they
have become accustomed to resorting to harassment
and other techniques which have hampered the
condition of the customer and this has led to
many malpractices being adopted by these third
parties.
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What is important to consider in this scenario,
is how difficult it has become for regulatory
bodies to track these organizations and link the
third parties activities back to the direct
lender, as there is no connecting link between
them as such. This creates an uncertain
environment, where the regulators find it
extremely difficult to reach out to the right
culprits in this entire mess.
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What is important to consider in this entire
scenario is the fact that there have been many
organizations that have worked towards capping
the interest rates and impose regulations which
have been made mandatory but the states need to
work in tandem with the regulatory body in order
to ensure that there is no scope for any kind of
malpractice that can be tolerated. This urgency
needs to be realized by the states as well and
all of them need to come to a common page in what
could become a repeat of 2008. 
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For more information visit our website
www.pacific-odyssey.co.uk
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Thank You