3 in 5 Brits unaware of their loan’s interest rates

Last post: Feb 23, 2018

Fresh research has revealed that many Brits are still living in ignorance of the interest being charged on the loans they are using, with many prioritising acceptance over finding a good deal.

 Do you know the interest rate you are paying on the loans you have taken on? If you do, you may be in the minority. Although a good understanding of loan charges and amounts is crucial to guaging affordability, a troublingly high number of unsecured loan customers do not know how much their loan is setting them back in interest.

Older, not wiser

Fresh research from Mintel suggests that around 60% of UK borrowers do not know how much interest their current loans are setting them back. Although you might assume that awareness of interest rates improve amongst older borrowers, this number rises to 74% amongst the 45-64 year old age group.

Younger borrowers are slightly less likely to use a loan without knowing the interest rate it carries, however they are worryingly likely to focus on finding a provider who accepts their application over finding a good deal and a competitive rate. 54% of 18-44 year olds claimed that a good interest rate was less important than being accepted for a loan.

Change still needed

This is a worrying statistic which suggests that British consumers may not be taking affordability seriously. It is now the responsibility of all lenders to ensure that their customers have the capacity to repay any unsecured loan they take on. This means consumers must have a good understanding of both the loan product and their own finances. Blindly accepting any interest rate and using a loan without all the facts in mind is a sign of irresponsible borrowing.

At Choice Personal Loans we help customers source unsecured loans which fit their lifestyles and budgets, working to ensure successful lending processes when emergency expenses arise. To find a smart fit for you, contact our finance experts today.