At times of financial hardship, it is often difficult to discover an effective solution. When faced unexpected financial challenges, there are potentially various solutions available yet the degree of effectiveness cannot be assumed prior to its implementation. Consumers of the UK credit industry have the option of various possible solutions to their struggles in the form of credit cards, bank overdraft programs, short term loans from banks, credit unions, retail lenders, etc.
Payday loan services in UK have seen an upward curve in the demand as well as for the supply to its consumers. It is not something that is ignored by consumers when considering a solution to their struggles. However, it is upon the consumers to weigh the consequences of adopting a financial solution which they consider effective.
Government regulatory bodies such as the Financial Conduct Authority (FCA) are working to ensure that payday loans are regulated with fair lending practices. Consumers need to be equipped with necessary information for comparing lender services to give them the opportunity to make a well informed choice. A comparative study of bank and credit union fees such as overdraft and other associated fees shows that a payday loan can be far more cost-effective alternative if fair lending practices are implemented.