Nationwide introduces personal loan summary boxes

Tue, 07 Jun 2005

Nationwide bank has announced they will be making use of summary boxes for all new personal loans in future.

This approach, the first of its kind for loans in Britain, is designed to give potential borrowers a summary 'at a glance' of everything they need to know about the loans offered by the loan lender.

The high street loan lender is claiming that by introducing the summary box, customers would be able to better understand everything they need to know about the loan before they apply for it.

The summary box would include details of the interest rate a customer will be offered if they were granted a loan, the amount that would be lent to them, the lending period, arrangement and early redemption charges, and example costs of loan repayments and Payment Protection Insurance, if applicable.

The decision to introduce the summary box comes after Nationwide conducted mystery shopper research pf major issuers of personal loans in Britain.

According to this research, many people who applied for personal loans had no idea of the loan rate they would be offered until after they applied and their credit has been scored.

Stuart Bernau, executive director at Nationwide, commented: "There is too much confusion and lack of transparency for consumers taking out a personal loan. It is up to the industry to be fair and give clearer information to enable customers to make a decision.

"If the industry adopted Nationwide's lead, it would highlight some of the extortionate rates people currently have to pay for personal loans. This will lead to more consumers getting a better deal," he said.

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