Cheapest loan in the world

2009-11-22T02:33:00.000-08:00

Britons have access to the some of the cheapest personal loans in the world, according to new research from the British Bankers' Association (BBA).

In a report carried out by independent economic consultancy Oxera as part of the BBA's annual appraisal of the UK loans, credit card and current account market, it was found that Britons have access to some of the cheapest financial products in the world.

When compared to prices for loans in other countries - including Finland, Canada, Germany and Australia - UK personal loans have the cheapest Annual Percentage Rate (APR), Oxera found. The typical borrower seeking a two-year personal loan in Britain will pay an average six per cent, while consumers in Ireland are faced with APR charges of around 11 per cent and Americans pay just over ten per cent in interest each month.

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2009-09-04T23:40:00.000-07:00

A loan is a type of debt. Like all debt instruments, a loan entails the redistribution of financial assets over time, between the lender and the borrower.

In a loan, the borrower initially receives or borrows an amount of money, called the principal, from the lender, and is obligated to pay back or repay an equal amount of money to the lender at a later time. Typically, the money is paid back in regular installments, or partial repayments; in an annuity, each installment is the same amount. The loan is generally provided at a cost, referred to as interest on the debt, which provides an incentive for the lender to engage in the loan. In a legal loan, each of these obligations and restrictions is enforced by contract, which can also place the borrower under additional restrictions known as loan covenants. Although this article focuses on monetary loans, in practice any material object might be lent.

Acting as a provider of loans is one of the principal tasks for financial institutions. For other institutions, issuing of debt contracts such as bonds is a typical source of funding.(Wikipedia)

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Looking for a cheap loan? Then find out whether cheap loans are really the best by reading our impartial cheap loans guide.
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Guide to payment protection insurance One of the main concerns for anyone taking out a loan is whether or not they will be able to meet the monthly repayments if they lose their job or are unable to work due to illness. If you are concerned about the possibility of being unable to make the payments, you can take out payment protection insurance (PPI), which is offered by most lenders, as well as a range of insurers. Read our impartial guide to find out more.(moneysupermarket.com)

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Cheapest loan in the world

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