New research from KBC Bank Ireland shows that more than half (53%) of consumers who have taken out a personal loan do not know what rate of interest they paid on the sum.
The survey found that while 53% of adults questioned had taken out three or more personal loans over their lifetime, men were more likely to borrow, with 33% having successfully applied for a loan five times or more.
The majority of those surveyed (63%) said they currently have a personal loan, while 59% of respondents said they plan to apply for one in the near future.
KBC’s research found that loans were primarily taken out to buy new (18%) or used cars (17%), or to carry out home improvements (25%), with women more likely (32%) to borrow for home renovations. Holidays (12%) and education (9%) were also popular reasons for borrowing.
One in ten respondents said they had borrowed for refinancing reasons, rising to 16% of male respondents. Among those considering a personal loan in the near future, new (23%) and used (17%) car purchases, as well as home improvements (20%) are still the main reasons for borrowing.
Furthermore, the KBC survey found 73% of customers who previously received a cash loan opted for a fixed interest rate and 27% for a variable rate, however, 53% of those who had taken out a loan did not know what interest rate they paid.
Almost two thirds of loan terms were for three years and under.
All those questioned had used online banking in the previous twelve months with 75% banking online once a week or more. More than a third use the internet as their main loan application channel, and more than half still choose a local branch to apply in person.
Director of Products at KBC Bank Ireland, Eddie Dillon said, "Our research shows that people borrow for a range of reasons, from buying a car to planning a wedding, to renovating their home. Whatever the reason, customers are looking for attractive rates, a hassle free application process, and quick approval times."
Source: www.businessworld.ie
