Payday loan industry is growing fast

People are taking out payday loans as an alternative to seeking out the most competitive loan interest rates on the high street, an expert has claimed.

Ed Bowsher, head of consumer finance at lovemoney.com, said that the payday loan industry is booming which means more and more people must be using their services.

He explained that many people chose payday loans when they are unable to get approval for the best loan interest rates from the bank.

"No doubt some people take out payday loans because their bank won't lend to them," he said, but added that this is not the sole reason they are becoming more widespread.

"Others may just like the speed – payday loans reach your bank account within 15 minutes," Mr Bowsher added.

Recent research from R3 revealed that six million people are currently behind with some of their bills and payments, an increase of two million in the last quarter.

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2011-06-13 13:00:35 © Moneyextra.com