118 118 Launches Consumer Loans Business to Address Credit Shortfall

LONDON, September 30, 2013 /PRNewswire/ --

Simple and straightforward £1,000 to £5,000 personal loans

118 118, the UK's leading directory assistance provider, today launches into the UK financial services market to offer loans for consumers seeking credit from a trusted brand.

Available only from 118118Money.com, the new financial services business is offering what it believes consumers will appreciate; simple, straightforward £1,000 to £5,000 unsecured personal loans with fixed repayments over 12 to 24 months at an APR of 35.9% and monthly repayments from £57.

Mark Mayhew, non-executive director, 118 118 Money, said:

"Five years on from the credit crunch, lending remains less accessible than it should be for many hard working consumers. Our new business strives to address this by lending when the banks won't in the £1,000 to £5,000 range.

"The new team at 118 118 Money brings significant experience of consumer lending to develop a more human approach to credit risk assessment."

Paul Noble, chief operations officer, 118 118 Money, said:

"We are able to extend the availability of unsecured personal loans to people who may otherwise struggle to find a trusted and responsible lender. In addition to verifying each applicant's identity and accessing thousands of data points, we then have a team of underwriters who talk to applicants and bring back the human approach to making lending decisions.

"That means people who might normally have been rejected through automated systems may not be by us. It also means we can consider offering a second chance rate at 79.9% APR if this matches their circumstances.  After a loan is made, we understand that things can change, so we offer a late fee refund to help people through if things get tough for them."

118 118 Money also provides clear information about how lending works in practice, offering tips, guides and a credit questionnaire so its customers can review their likely loan options.  The 118 118 Money team is available 24 hours a day, seven days a week on a freephone number (0800 0118000) to support people through the application process, to understand the lending decision and to provide ongoing support with their loan.

 Mark Mayhew added:

"Our findings show that 28 per cent* of people don't understand why they are rejected for a loan and 88 per cent* don't know their credit score, so a really big part of our relationship with our customers is helping them understand the importance of how credit ratings work and what it means for managing their finances.   That's why we also offer a simple credit questionnaire for useful guidance on the best option for their circumstances. That might include a loan from a high-street bank, one from us or to consider paying off existing debts first."

118 118 Money starts lending from today at 118118Money.com.

*"28% of people don't understand why they are rejected for a loan" - Source: 118 118 Omnibus August 2013, based on all respondents who have been rejected for a loan (n = 122)

*"88% don't know their credit score" - Source: 118 118 Omnibus August 2013, based on all respondents (n = 2034).

Notes to Editors:

APR & Representative example

Representative example: Amount of credit £2,000 for 24 months. Interest rate: 31.1% pa (fixed). Monthly repayments: £112.93.  Total amount repayable: £2,710.32. Representative 35.9% APR.

Loan Product Features

• Apply on 118118Money.com
• Offers unsecured loans between £1,000 and £5,000
• Repayment term is 12 to 24 months
• Fixed monthly repayment amount from £57; fixed APR of 35.9% for majority of successful applicants. Alternative APR 79.9% where credit assessment cannot support APR 35.9%
• No arrangement or set up fees. Missed payment fee of £12 (refunded once the next three repayments are made on time)
• 24/7 freephone personal guidance to complete application; provision of online credit questionnaire to guide applicant
• 'Interest free' birthday: no interest payable on that day

Research

118 118 Money has undertaken many months of market and consumer research:

• Nearly 1 million people were rejected for unsecured personal loans between £1,000 to £5,000 in the last year
• Nearly 5 million people were refused financing for all loan types, averaging £2,700 in the last year
• 28% of applicants declined did not know why
• 88% of borrowers do not know their credit score
• 10% think it 'impossible' to improve a credit score
• 88% consider a low APR is one of the key factors when taking out a loan and yet:
  • 50% of borrowers surveyed could not recall the APR on their most recent loan
  • 77% do not know how APR is calculated
• 54% of people rejected for a personal loan give up

Sources:

    Commissioned from 2CV

• Bespoke survey, 511 respondents, February 2013.
• Omnibus, 289 respondents, April 2013
• Bespoke survey, 202 respondents, June 2013
• Omnibus, 2,034 respondents, August 2013
• Bespoke survey, 444 respondents, August 2013
• Bespoke survey, 871 respondents, August 2013
  

About 118 118 Money

118 118 Money is a new financial services business from 118 118 launched in September 2013, offering unsecured personal loans to consumers through 118118Money.com.

We offer borrowers loans of £1,000 to £5,000 with fixed repayments over 12 to 24 months at an APR of 35.9% and monthly repayments from £57.

As always, we add our own human touch. Combining the power of analysis with deeper assessment by our experienced underwriters, 118 118 Money aims to make lending more available to hardworking, creditworthy consumers.

118 118 Money provides support 24 hours a day, seven days a week on a freephone number (0800 0118000) to help our customers through the application process, to understand the lending decision and to provide ongoing support with their loan.

About 118 118

118 118 is relied upon by more than 20 million people every year for fast access to the numbers they want and the business services they need.

Launched in 2003, 118 118 almost immediately became and remains the nation's favourite directory assistance service, made enjoyable and memorable by the unexpectedly quirky 118 118 runners.

The company continues to invest strongly in useful new information services including texted answers, free search from 118118.com and our 118 118 Mobile App for numbers and businesses on the move.

In everything it does, 118 118 seeks to provide ready and prompt fulfilment delivered by people.  The company has a passion for creating products and services that save time, cut down on hassle and enable people to get on with enjoying their lives.

118 118, based in London and Wales, is a wholly owned subsidiary of kgb, a privately owned business that is the world's largest independent provider of enhanced information services used by more than a hundred million people every year.