On the 8th November, the Central Bank published a report on the licensed moneylending industry in Ireland. The research was undertaken to inform the regulatory approach to this industry and to see how relevant firms are treating their customers.The key findings of the research are as follows:
- the most common loan amount is between €200 and €500;
- the most frequent term offered is approximately 9 months with an APR of 125%;
- customers typically use loans from moneylenders to purchase goods (30%), family events (23%). 9% of customers borrow to pay bills or their debts.
A significant proportion (25%) of customers surveyed experienced difficulties in making repayments in the past 18 months, with:
- 63% of those reporting that repayment difficulties were caused by a drop in household income.
- a majority of customers (84%) know the cost of credit on their loan and 69% understand the amount of interest charged on their loans.
- the majority (65%) of customers reported that they have repaid a loan/line of credit early. However, almost one in three (31%) of those recall receiving a rebate for doing so.