Looking for the perfect way to bridge your finances to the next payday?
Before you enter your details into an online payday lenders site, step away from your keyboard; you might be about to fall victim to the new payday scam.
With new options hitting the market all of the time, picking a good company can be a nightmare.
In our article we explore the new scam that you must be aware of!
First payment upfront
Firms, which are thought to be foreign, target people with limited financial options, who are rejected by banks and forced to use forms of online borrowing.
The premise of this particular scam is to offer a pre-agreed sum of £2,000 (for example) which can be repaid at a reasonable rate on the assumption that the first payment is paid upfront.
Once this payment is made, the unsuspecting borrower will hear no more from the company and the remaining balance will never be transferred into their account, leaving their financial position far worse than it was before.
A Recent Example
A recent example of a new scam was reported in the Hull Daily Mail and resulted in a cash-strapped father being conned out of £100s by a devious scam targeting vulnerable borrowers.
The delivery man from Beverley was conned out of almost £300 by a bogus operator who fooled him into handing over money in exchange for a quick £3,000 which never arrived.
The 43-year-old man, who does not want to be named, said:
“All I wanted was to help my children so they aren’t struggling but now, it has left me broke and struggling. I am robbing Peter to pay Paul.”
Hull Daily Mail
Tips to Avoid Being Exploited
Common sense and staying aware are both vitally important when it comes to staying ahead of any potential scams.
To help you further, we have drawn up 3 of the most important tips to help avoid being exploited.
If something seems too good to be true, it probably is
Do not give out your bank or personal details to anyone who approaches you out of the blue
Do not pay any money up front!
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Representative APR: 49.7% (variable)
Rates from 43.1% APR to 1333% APR. Minimum Loan Length is 1 month. Maximum Loan Length is 36 months.
Representative Example: £1,200 borrowed for up to 75 days. Total amount repayable is: £1506. Interest charged is 0.34% per day, amounting to £306, annual interest rate of 124% (variable).
IF YOU ARE THINKING OF CONSOLIDATING EXISTING BORROWING YOU SHOULD BE AWARE THAT YOU MAY BE EXTENDING THE TERMS OF THE DEBT AND INCREASING THE TOTAL AMOUNT YOU REPAY