Sainsbury’s promises to offer cheapest loans
Supermarket retailer Sainsbury’s is leading the market at the moment with a 5.9 per cent loan rate, and it has also launched a Price Promise Guarantee.
The 5.9 per cent rate is available on a £7,500 loan with a three-year term, while the same loan over five years would be available at 6.1 per cent.
Under the retailer’s Price Promise Guarantee, if a customer successfully applies for a standard loan with Sainsbury’s but is then offered a better deal elsewhere, Sainsbury’s will undercut the better offer by 0.1%.
The guarantee only applies to Sainsbury’s standard loans between £1000 and £25,000 and is not applicable to Sainsbury’s Shopper Reward loans.
Claims under Price Promise Guarantee must be made within 28 days of receiving the original loan offer from Sainsbury’s and the guarantee will not apply when a loan agreement with Sainsbury’s has been accepted and signed for.
The latest figures from the Finance & Leasing Association (FLA), the trade body for the consumer credit industry, indicated an improvement in consumer credit markets.
There was a 9 per cent increase in lending to consumers in March this year, compared with March 2011.
The FLA’s figures cover personal loans, credit cards, second mortgages, car finances and store instalment credit.
The statistics suggests that people are using credit card more for both day-to-day living expense and for large purchases.
In March 2012, £2.8 billion was borrowed on personal loans and credit cards, an increase of 2 per cent from the same time last year.
The car finance market showed the most substantial growth, with an increase of 20 per cent compared with the first quarter of 2011.
Fiona Hoyle, Head of Consumer Finance at the FLA, said: “Our figures show a slight rise in most markets, which suggests that consumer confidence is showing signs of a tentative return.
“But many consumers continue to be cautious, reinforcing the need for the Government to make sure that their proposed changes to consumer credit regulation do not limit the supply of affordable, responsibly-provided credit.”