FINANCIAL SERVICES
As the lending environment is impacted by the global financial crisis , service providers are seeking new ways to retain customers
These days , most customers seeking loans are stuck between a rock and a hard place . The cost of living crisis has resulted in less disposable income and , in many cases , essential payments can only be managed with the help of understanding lenders .
However , lenders – fully aware of the plight of customers and rising interest rates – have rolled back many of their affordable products and services , leaving fewer credible options in the marketplace for loan-seeking consumers . Even when sound agreements are met between banks and consumers , economic instability is a constant source of stress . In the UK alone , inflation is at its highest rate in 40 years – and energy price rises show no sign of slowing down . These elements place additional pressure on businesses and lenders , alike .
Furthermore , spending , as expected , has contracted and savings are also being depleted . So how can consumers protect their financial assets , maintain their savings and still manage a healthy relationship with their financial services provider ?
In an age of digitised , global finance , the humble Credit Union has one lending solution that could well preserve the pocket change of even the most financially challenged borrower – in the form of loyalty loans .
How do Loyalty Loans work ?
According to the UK ’ s Wiltshire & Swindon Credit Union ( WASCU ), loyalty loans are a style of lending product that protects customers ’ savings when they request finance for essential purchases or expenses . Rather than using their own cash to secure a transaction , the lender will provide up to five times the amount the saver has accrued , with the option to pay off the loan within a flexible time frame – and usually with lower interest rates than standard lenders .
“ It is so important right now to refrain from making any rash decisions that could later damage a person ' s financial security ”