Providers 'cutting personal loan rates to attract business'

Thursday, 06 January 2011 12:00

Financial institutions are battling it out to win more business from those hoping to secure large personal loans, it has been claimed, with six brands cutting their interest rates in recent weeks.

Andrew Hagger from Moneynet.co.uk examined the moves a number of organisations have implemented to make their services more attractive to customers.

He noted M&S Money slashed its charges the most, with a five-year loan of £7,500 costing £522 less after it dropped its rate by 2.4 percentage points.

The new terms - which were launched today (January 6th) - would see people pay back £232.44 a month on a loan of this size.

Existing customers of first direct also saw APR sink by 1.4 percentage points on borrowing needs of between £7,000 and £15,000.

"It's welcome news for customers to see loan rates falling at long last and from some of the largest providers in the market," Mr Hagger stated, although he admitted it is disappointing more lenders do not open their offers up to new customers.

Use the myfinances.co.uk comparison site to find the best deal on credit cards.

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