For many who have had their application for a loan rejected, ‘payday’ loans have been a source of finance that has brought them back from the brink. However, it would seem there is a new way of lending money available, and it is from a rather unlikely source. 118118money, is an offshoot of the well-known 118118 directory service known for its men in mustaches, and they might just accept your loan application based on your social following.
118118 has branched out to offer loans for people that the market is apparently missing, the middle ground. According to Will Becker, CEO of Totally Money, the flurry of activity that has taken place since 2008 in the loans sector (thanks to payday providers), has meant a steady means of address of consumer’s needs, and is one of the reasons why 118118 is so innovative in their money lending approach. Part of their application process involves gathering information from your social following and data including Facebook and other social networking sites, and looking at the number of online friends you have, etc. This type of social media monitoring is relatively new to the UK and is definitely something that has caused some to worry about just how successful the applications will be, and I’m inclined to agree.
While I think it is a new and fresh approach to use a person’s social following to better understand the borrower, it does throw up concerns about just how much influence our social following will have. For example, think of the amount of people that just friend people they knew in secondary school and then never speak to them. Does that mean they could be given a loan, when someone else, possibly more deserving and less high risk, wouldn’t be given that same loan just because they do not utilize the same tactics?
Of course, this is an issue that 118118 has tried to address, trying as swiftly as possible to explain all the ins and outs of their loan process, and the logistics behind it. So far, I have to admit, it does seem like a sound loan option should you need to use sources other than your bank.
That being said I can’t help but feel that, like payday loans there is a lot of leeway for consumers to misunderstand the entire money lending process, therefore, get stung in the long run. However, if 118118’s online and telephone application is a thorough as it sounds, then my concerns could be nothing more than overly cautious and unnecessary worries. According to online sources, you will be able to apply for the loan online, include your social following statistics, and if accepted, you will then receive a call to talk you through everything and ensure that you fully understand what the loan entails.
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