Looking at the base rate being held unchanged this week Legal and General are forecasting a difficult Summer for borrowers as lenders take a cautious approach.
It is the view of Legal and General, as well as many other observers, that financial institutions went overboard with lending when money was cheap and easy to get hold of. Now they are going overboard the other way by being ultra cautious when lending to anyone.
Consumers will hope that something shifts in the market to free up money to cover general living expenses in some instances, where people have borrowed to maintain a standard of living and can no longer gain access to credit. Legal and General are not expecting that to happen as the cautious approach is maintained.
Liverpool Victoria has received a fine of GBP840,000 because of serious issues with the way it sells PPI or Payment Protection Insurance.
It appears that the Banking Services arm of Liverpool Victoria was automatically adding PPI to personal loan quotations even though prospective customers had not asked for it. The good news for any customers affected is that the amounts taken will be paid back as soon as possible to the 14,500 customers who had money taken from them in this way.
The average cost the addition of PPI placed on each person with a personal loan is around GBP1,600, which is a considerable sum when taken as a percentage of the amount borrowed. Liverpool Victoria customers are sure to appreciate the windfall, as well as the apology that will go with it.
According to an ICICI Bank spokesman the business is expecting to see an increase in loans provided running through the third and fourth quarters of the financial year.
The bank are confident that their commercial arm will be bringing in a large volume of loan business, with an expectation of twenty percent growth in the consumer sector too. This large growth expectation is fuelled by the reduction in interest rates they have applied, where home loans, car and personal loans have all seen their repayment rates reduced.
The commercial sector is forecast to see growth of around sixty percent according to information coming out of the ICICI Bank, driven primarily by the offering of new product lines to this market. Options will include a number of insurance products, new loan offerings and more banking facilities.
The bank feel that small to medium enterprises in India do not have enough options to meet their varied needs and so are happy to support them with these new products.
