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UK short term lenders have claimed that they are being tarnished unfairly by politicians who don’t understand the value of the services that they provide.

The perceptions divide of payday loans by politicians and people who actually borrow money using the short term lending services is vastly different according to the Consumer Finance Association (CFA) who said that most borrowers think that they are getting a good service.

YouGov carried out a study on payday lending which surveyed 300 customers of Money Shop, a payday lender and 300 politicians. Some of the results highlighted in during the study showed that only 12% of politicians thought that payday lenders explained their fees and interest charges clearly, compared to 89% of borrowers who had actually used the payday lending services.  89% of borrowers also said that they believe short term lenders treated people with respect while only 12% of politicians agreed.

According to the survey, half of the customers surveyed use payday loans once or less a year. 6% of customers use same day payday loans monthly. The CFA said that most customers use short time loans to “smooth out the peaks and troughs of their finances”.

John Lamidey, who is chief executive of the CFA, said: “Payday loans can be misunderstood by politicians concerned for the welfare of their constituents in tough economic times.”

“This research clearly shows that the people who actually use payday loans are extremely satisfied with them at every level.”

Image credit: William Warby