Overtime, lenders in the UK are growing more and more cautious as to who to and not to lend money. As a result, the procedures that surround unsecured loans have grown more tedious and the credit checks, more thorough. In such an environment, we have several different potential repercussions. One of this heap of different repercussions, according to me, is masses turning towards the alternative. I mean obviously, if you cannot get coffee, you will consider tea, or if you cannot get washing powder, you will consider washing liquid. Similarly, for those unable to get access to unsecured loans, the next best alternative seems like the immediate substitute – secured loans. So, it is safe to say that increases in popularity of secured loans is not solely a function of the benefits such loans accompany but also the troubles that the substitutes put us through.
To give you a peek at the numbers that corroborate the above mentioned information, I have set aside supporting statistics. If we rewind back to a year ago, around this time in 2012, the average lending per month was about £33 million. If you think this is astonishing, I think you will love what is next. While this figure may be quite high on its own, we saw a startling increase to about £42 million in the first three months of this year, showing us more clearly than ever the high demand for secured loans. Upon comparison, the figures over the last 12 months show a 47% increase, which is by no means ordinary.
Numbers are statistics and these statistics represent increasing penchant for the people of the UK for these loans. However, does that really mean that the secured loans industry is doing more business than it was? Or does it mean that we are just writing higher cheques? A further look into the situation allows us to see that the lenders have actually increased the upper limits on the loans they give, allowing borrowers to get access to much bigger amounts. This explains the increasing figures and thus, show that while there may still exist the fact that an increasing number of people are turning towards these loans, extending limits has also added to the numbers.