Feeds

Quick cash-by-text deals slammed for sending Swedes into debt

EZ $$$

Using blade systems to cut costs and sharpen efficiencies

Cash-hungry people can already apply for loans in the High Street, online or over the telephone, but the addition of text messaging services to the list of lenders is now being blamed for pushing hordes of Swedes into the red.

Around 30 companies in Sweden now offer short-term loans that can be easily applied for and granted by text message, Agence France Presse reports. But since such services were first offered, in 2006, at least one local debt recovery firm has had to approach around 20,000 defaulters.

Almost 40 per cent the customers caught short by the ability to call up cash are aged between 18 and 25.

The technology allows the cash-strapped to see up to €300 (£250/$500) beamed directly into their bank accounts within 15 minutes of asking for it by text. Repayment terms can be tough, it's said, and some lenders demand payback of the loan, in addition to fees and interest, within 30 days.

A spokesman for Mobillaan Sverige, which was the first company to offer loans by text in Sweden, said the service was very popular and claims that they are sending Swedes into debt spirals was exaggerated.

Mobillaan, he claimed, checks credit histories before agreeing loans. He blamed the country's financial regulators for not getting to grips with the concept quickly enough, in the process allowing less scrupulous lenders to offer easy money to people who shouldn't receive it.

"[Loans-by-text's] huge success caught the authorities by surprise," he said. "They did not know how to handle it."

Register Hardware doesn't know of any loan-by-text services operating in the UK, but its not hard to imagine many credit-crunched Brits plunging even further into debt if such services spring up.

Numerous texting services have already 'transformed' our lives, such as the ability to order a takeaway with an SMS or find the nearest public toilet. But is texting for a loan tech gone too far? Register Hardware wants to know your thoughts, so text us on...

HP ProLiant Gen8: Integrated lifecycle automation

More from The Register

next story
Yorkshire cops fail to grasp principle behind BT Fon Wi-Fi network
'Prevent people that are passing by to hook up to your network', pleads plod
Major problems beset UK ISP filth filters: But it's OK, nobody uses them
It's almost as though pr0n was actually rather popular
Microsoft unsheathes cheap Android-killer: Behold, the Lumia 530
Say it with us: I'm King of the Landfill-ill-ill-ill
All those new '5G standards'? Here's the science they rely on
Radio professor tells us how wireless will get faster in the real world
Apple orders huge MOUNTAIN of 80 MILLION 'Air' iPhone 6s
Bigger, harder trouser bulges foretold for fanbois
US freemium mobile network eyes up Europe
FreedomPop touts 'free' calls, texts and data
'Two-speed internet' storm turns FCC.gov into zero-speed website
Deadline for comments on net neutrality shake-up extended to Friday
Oh girl, you jus' didn't: Level 3 slaps Verizon in Netflix throttle blowup
Just hook us up to more 10Gbps ports, backbone biz yells in tit-for-tat spat
prev story

Whitepapers

Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Reducing security risks from open source software
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.