Exclusive: Londoners take 133% more payday loans to cover Christmas this year
Pressure on households to overspend this Christmas is leading more and more Londoners to resort to payday loans to cover the costs of the holiday season.
Payday loans in London are set to rise 133% as households struggle to cover holiday costs, according to the results of a survey that pan-European credit manager Lowell shared exclusively with City AM
They are also taking more standard loans and making more use of Christmas pre-purchase programs, such as Christmas catalog items that are paid off in monthly installments.
When asked how households financed Christmas 2019 and how it compares to Christmas 2020, we find that payday loans will increase by 133%, loans will increase by 87%, while disposable income is expected to decrease by 9%. .
When asked how households financed Christmas in 2019 compared to this year’s holiday season, as shown in the table below, Lowell also found that nearly one in 10 Londoners borrowed money. money to friends or family.
|Financing option this christmas||% difference from 2019 to 2020|
|Christmas pre-purchase programs||67%|
|Borrow from friends or family||9%|
The results come despite nearly a quarter of London households have said they plan to cut spending over the Christmas period, while 40% are said to feel financial pressure, more than any other region in the UK.
The company also found that 24% of Londoners are set to cut spending, the highest proportion of any region in the UK, followed by 23% of households in Bristol and 20% in Sheffield. Below the percentage of UK households by region expected to cut spending this Christmas:
|Zoned||% of respondents|
Additionally, 66% of Londoners feel pressured to overspend on Christmas and 70% feel pressured to overspend on food.
‘While many London households intend to cut spending this year, it is worrying to see an increase in the number of people intending to use payday loans or other credit methods to finance Christmas . This can lead to debt which can get out of hand, ”said John Pears, UK Managing Director of Lowell.