Here Are the Payday Lenders With the Most Consumer Complaints
Payday loans are the notorious debt trap . They often prey on vulnerable and desperate consumers and then send them into a downward spiral of debt. Here are the issues customers complain about the most, as well as the five worst offenders.
Using data from the Consumer Financial Protection Bureau , David Chen of Millennial Personal Finance compiled a list of the top payday loan consumer complaints and lenders with the most complaints. Chen explains his methodology:
Only the top 25 lending companies are listed with over 200 companies, but these 25 companies accounted for over 70% of payday loan complaints in 2016 … Data was taken from the CFPB Consumer Complaints Database as of Jan 6 2017 year. This data includes all payday loan complaints filed with the CFPB for the full year of 2016. A total of 1539 complaints were analyzed. All data were sorted by company and type of complaint, respectively, in published tables.
Unsurprisingly, the most common complaint was that the lender was “charging a commission or interest that I did not expect.” Given that interest rates on payday loans can be as high as 780% and they are not very clear about it, it is no surprise that consumers did not expect such fees (and this is an important reminder to always read and analyze the fine print of any financial agreement.) However, there were several other complaints regarding:
- I can not contact the lender
- Got a loan that I didn’t apply for
- Unable to stop debit from bank account
- The payment has not been credited to the account
Top 5 lenders with the most complaints:
- Big Picture Loans, OOO
- ACE Cash Express Inc.
- Enova International, Inc.
- Speedy Cash Holdings
- Financial corporation CNG
As dire as they are, payday loans are a legitimate business practice, so they are a good reminder to the buyer to do their research and read the fine print. It’s also alarming for anyone considering getting a payday loan: make sure you know what you’re getting into because they aren’t really meant to work in your favor. For more details, navigate to Chen’s full post at the link below.
CFPB Payday Loan Complaints – Data Analysis | Personal finance of millennials