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Loans May Be Hard To Come By But Bank Accounts Are Not

by Jim ONeil on February 13, 2012

in uk banks

When it comes to loans, bank offerings are few and far between. Only UK consumers with good credit are approved and just a small number of them qualify for the lowest loans APR. Everyone else is either rejected or saddled with a very high APR.

This is driving consumers toward no credit check loans that are easier to obtain and provide money much quicker. Consumers are forced to forgo cheap loans from banks for more expensive payday loans. At the same time, they have their pick of current accounts.

Banks are engaged in stiff competition for current account customers, involving UK consumers in a tug of war. High street providers strive to attract consumers to take current accounts because most UK residents approach their own building society or bank first when they need new financial products like loans, credit cards, and mortgages.

Consumers are notoriously hesitant to switch the account they use to make regular deposits and take withdrawals.

To lure consumers their way, financial institutions are offering some incentives. According to Moneyfacts, the number of banks providing “switcher incentives” has increased during the past few weeks. Santander, Halifax, and HSBC are three of the high street providers offering these to new customers.

Incentives include interest-free overdrafts and cash payments designed to make switching current accounts more attractive.

Beginning in 2013, it will be even easier to switch bank accounts because new regulations will reduce waiting times. Though they may not be able to secure the loans cheapest available, UK consumers may receive some great benefits for changing their current account.

The lending environment may even change by then, making it easier for consumers to get a loan from their new bank.

Current accounts are the most common personal financial products that UK consumers use. Therefore, many consumers were more than willing to weigh in on the recent Consumer Moneyfacts Survey. More than 60,000 people responded, making this the largest poll of its kind.

They named Barclays the best current account provider due to its wide range of offerings. With the debate regarding current account charging raging on, Barclays managed to edge out the competition with its low rates, assortment of benefits, and outstanding customer service.

Consumers make the switch to Barclays due to products like the Barclays Bank account, which features no monthly fee and includes a Barclays Visa debit card. Telephone, mobile, and online banking is available and this account has an overdraft feature.

Once they have their new account, they can explore the bank’s personal loan options and compare these with shorter-term financing offered elsewhere to find the loans cheapest for their needs.

Whether they choose loans bank offered or provided by a payday or other short-term lender, consumers can find a good deal. A Barclays customer registered for online banking can receive personal loan funding from the bank within just three hours after acceptance of an online application.

Barclays even offers a price guarantee, matching the rate of a cheaper loan and providing an additional £50.

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