- Thursday, 16 July 2009The number of lenders offering unsecured personal loans (UPL) has decreased over the past two years, according to moneyfacts.co.uk.
The website also indicates that those lenders continuing to offer UPLs have increased their rates by up to 3.7 per cent.
Growing costs for people already reliant on a UPL could result in an increase in the number of people seeking debt help in the future.
For loans of £1,000, consumers are subject to an average interest rate of 19.2 per cent, a rise of 1.9 per cent on 2007 levels. To take out a £5,000 loan, customers will be subject to a 12.4 per cent interest rate, representing an increase of 3.7 per cent.
Louis Kaszczak, head of moneyfacts.co.uk, said that the number of lenders offering UPLs had decreased as a result of the higher risk of non-repayments within the financial climate.
He said: "Many lenders are pulling away from unsecured lending as the risk of customers defaulting continues to increase."
Lenders to have withdrawn from the market include the AA, Direct Line and Northern Rock.
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