Starting a payday loan company? - Page 2

Subman · #11 2nd December 2008, 22:38

have a look at the singingpig forum. There are a number of people on there that have set up door step loan company's and there is a lot of discussion on the pro and cons. Some of them have been trading over a year now. Look out for posts by PAL and CRAIG.

NetConneXions · #12 3rd December 2008, 00:17

Quote:

Originally Posted by 180sxboi

Hi guys, im new to the site and basically logged on just to ask this question.

I was thinking of starting up a Payday loan business. Maybe im being naive but i was hoping to do so with a budget of £20k. This is money I have in the bank from an inheritance and I want to try and make it work. I could also start it as a partnership with my brother who would be able to add an extra £20k but I would prefer to do this on my own.

Being broken down basically I was thinking...

Up to £10k on setting up. This would include money set aside for lease payments on an office untill i got up and running, money required to set up office, the costs of any licences, legal fees etc

Then the remainder as the money i would loan out.

Being optimistic if i had the full amount loaned out I would be looking at earning £2500 per month. (ive been researching and on average these companies charge £25 per £100 and the maximum loan time is 1 month, untill their next pay date.) I would imagine I would be able to run it on my own so i wouldnt have any more wages to pay.

I am sure there are a few laughing at my optimism but in my head it appears possible.

Please feel free to coment, good or bad. I look forward to the replies.

Get a job as a loan collector, that will give you some experience in what may entail. ok thats a bit OTT but.....i get the feeling it would be your first business and a loan company i dont believe would be the best option for you especially if its new to you.

Also like someone else said, 40k isnt alot for a start up loan company.

JEREMY HAWKE · #13 3rd December 2008, 05:50

Wow your brave !!!

Im struggling to get money out of some of the best companies at the moment .The last thing I would want to do is try to do the same with a bunch of chavs !!!

180sxboi · #14 3rd December 2008, 11:08

Ive been thinking about it over this last while and maybe it isnt such a good idea. As i said in my original post I was maybe being a bit optimistic but isnt that what this type of forum is for, all the advice has been great but i think ill put on hold for the time being, im starting a driving instructor course after christmass so ill see where that takes me for now...

SusanHendricks · #15 17th March 2009, 05:22

It is a good idea but you have to quite ruthless as well as the people you will deal with are at the low end of the payday loans scale and it starts with less interest .

g5media · #16 17th March 2009, 09:15

Quote:

Originally Posted by Subman

have a look at the singingpig forum. There are a number of people on there that have set up door step loan company's and there is a lot of discussion on the pro and cons. Some of them have been trading over a year now. Look out for posts by PAL and CRAIG.

SingingPig - isn't that the site dedicated that laughable Rich Dad Poor Dad stuff?

BootCamp · #17 17th March 2009, 09:56

I think this is a good idea principle. I had to use one of these about a year ago. It may be a good idea to use one yourself just to see how the process works.

The company I used set up a one off direct debit for the date you specify for the amount plus thier "interest" and on that date charged my bank. Transaction complete.

To do this you would need, a website with the back end workings to process the transactions, take and securely store the information from the clients, and I can see that being pretty expensive.
As has been mentioned you would probably need some affiliation with Consumer Credit of FSA, I am unsure.
A decent advertising campaign. Forget SEO is a scam. Think where your likely clientele are going to be. I'd have thought the bookies would be a good idea!
Finally, I reckon the average amount you would be lending out would be £300, to between 15 and 20 people, depending on how much and how widespread your advertising, meaning you'd need at least £6000 in cash flow. With a £1000 for advertising, and well, could throw a dart at the wall for the website. Probably £2-3000. Minimum. So £10k to start up, could be done. I reckon it'd earn you approx £1250 a month, minus any advertising costs and wage you wanted to take.

Go for it.

BusinessIdeas · #18 25th March 2009, 08:52

I have been running a cash loan credit company for many years now and it is hugely profitable. It is not payday loans, the loans are collected weekly from the customers home. Cashflow is not a problem because the growth comes from re-lending out all the collections in a particular week, so once you have put your original investment in, you can just re-invest for growth. On a small start-up say; £5000 you would need to have a second income for the first year to live on while the business grows. There are a lot of new regulations for the credit market and you need to be oft licensed. I do offer a full training program see: www.briteways.com for details - Gina

BusinessIdeas · #19 24th June 2010, 12:28

Just wondered if the op ever got this off the ground?

pete50 · #20 24th June 2010, 19:01

always wondered,how do you get the money back from the non-payers?