Text Loans in 5 Minutes (Gert Koppel Txtloans)

Txtloans, Gert Koppel

Would you like to take a loan for £100, and are you happy to repay £110 a week later? 

If so, you can do so from the comfort of your sofa, your supermarket or your shopping centre, by sending a simple text message. 

Since a TxtLoan money transfer takes under five minutes, your £100 will hit your bank account before you get to the checkout.

The TxtLoan service targets “end of the month” shoppers who would like to keep spending until payday, or for those facing an unexpected bill.

Customers must register with TxtLoan to sign up for the loan facility. Once they are approved, they can activate their loan by text, using a personal PIN, at any time.

The company claims it offers an alternative to the much-publicised bank charges for unauthorised overdrafts, that can cost up to £35.

As a result, while TxtLoan advertises its loans on its website at an APR of 994%, the company maintains that given the short term nature of the lending, the term APR is not appropriate. It points out that the bank overdraft charges cited above for a small dip into the red could be equated to an APR of 3,500%.

The 15,000 customers TxtLoan has attracted since opening 9 months ago seem to agree. 

What’s the downside?

The downside is the fee levied on late repayments. 

Woe betide those who fail to repay a textloan on time. If you do not stump up your £110 on day 8, TxtLoan has the right to debit your account - and they come down on you like a snowfall from a Christmas tree. 

• Day 9: TxtLoan will send you a reminder plus an admin charge of £25, total £135. If that doesn’t work:
• Day 11: TxtLoan sends 2^nd reminder plus an admin charge of £25, total is now £160. If that doesn’t work:
• Day 16: TxtLoan sends 3^rd reminder plus admin charge of £20, total now £180
• Day 23: TxtLoan sends 4^th reminder plus admin charge of of £20, total now £200
• Day 46: TxtLoan refers you to their collections department and charges “additional administrative charges and transaction fees”

TxtLoan runs a credit check on all applicants as part of registration, and states quite clearly that customers must be in employment, and will be declined if they have been declared bankrupt or have been subject of debt collection within the last 18 months. “Other than that we will most likely approve your application,” TxtLoan states on its website. 

Txtloan was founded by 26-year-old Estonian businessman Gert Koppel. Based in London, TxtLoan is a lender licensed by the Office of Fair Trading.

Given the heavy charges that apply to late payments, TxtLoan’s service is suitable only for responsible borrowers who are able to repay on time.