11 Million Consumers In Danger Of Being Refused Credit Warns Uswitch.Com

The Launch of Personal Loans Comparison 'Calculator,'the only UK comparison service that shows which lenders use risk-based pricing model.

July 23, 2004 -- Nearly 11 million* people could have their credit rating impaired by paying bills late warns independent market analyst uSwitch.com

The warning comes as 85 per cent of the industry has moved towards a risk-based pricing model which means that lenders offer a different interest rate to the one advertised, depending on the applicant's personal credit rating; ratings can be affected by factors including late payment of bills.

It also coincides with the launch of uSwitch.com's Loans Comparison Calculator today, a move that further cements its position within the personal finance sector following the launch of its Credit Card Comparison Calculator earlier this year.

Paul Schofield, Head of Personal Finance, at uSwitch.com cautions: "Risk-based pricing makes it more difficult for consumers to obtain a loan at the 'best' rate. Consumers only find out the APR they will be offered once an application has been assessed. But the sting in the tail is that applications are registered on credit files, which could adversely affect credit scores and consumers need to know this."

Independent research commissioned by uSwitch.com reveals that one in four* consumers (equates to 11 million) don't know that late payment of bills can affect their ability to obtain credit.

And even more worryingly, half of adults occasionally, or always, pay their bills late.

Thirteen per cent of the population pay their bills late every month or at least once a quarter and this rises to 64 per cent among the 18-24-year-old age group.

However, of the total number of people who do know that late payment of bills affects credit rating, 19 per cent still continue to pay their bills late!

Paul Schofield comments: "This ostrich mindset can and does have adverse effects, despite consumers knowing what the consequences are to their credit rating.As more and more lenders have adopted the risk-based pricing model, it has become even more important for consumers to use comparison tools such as online calculators to help them decipher the deals available, work out their repayments and decide upon the loan that best suits their circumstances. The uSwitch.com loans calculator is the only comparison site that compares all personal loans and shows which providers use risk-based lending criteria."

The features of uSwitch.com's Loans Comparison Calculator include:

* The uSwitch.com Loans Calculator enables consumers to compare all unsecured personal loans* on the market to find the one that best suits their individual needs.

* The uSwitch.com Loans Calculator has the ability to calculate and illustrate loan repayments for loans that operate an introductory rate' APR system.

* The uSwitch.com Loans Calculator has a risk-based pricing flag that alerts consumers to those lenders that employ risk-based pricing.

* The consumer can view the loans in their results table either with or without PPI.

* The uSwitch.com Loans calculator enables the consumer to compare loan features and benefits as well as financial costs/ savings.

Paul Schofield concludes: "The launch of our Loans Comparison Calculator has been driven by consumer demand and feedback from our existing customers. With consumer debt at an all time high and many people struggling to pay bills, we envisage the launch of this service will help people manage their finances more effectively, by offering an unbiased, simple and clear comparison tool which presents a complete picture of the loans market."


For more information visit www.uSwitch.com/loans
or call 0800 093 06 07

For further information contact
* Jennifer Evans, uSwitch.com, on 0207 802 2923 or e-mail protected from spam bots

* Beverley Aujla, Lansons Communications, on 020 7 294 3683 or e-mail protected from spam bots

* Ellie Stanton, Lansons Communications, on 0207 294 3633 or e-mail protected from spam bots

Notes to editors:
*Research carried out by ICM on behalf of uSwitch.com. ICM Research interviewed a random selection of 1008 adults aged 18+ by telephone between 14-15 May 2004. Interviews were conducted across the country and the results have been weighted to the profile of all adults.

uSwitch.com is a free, impartial online and phone-based comparison and switching service which helps consumers compare prices on gas, electricity, home telephone, digital television, credit cards and loans. Our aim is to help customers take advantage of the best tariffs and services on offer from every supplier. The company has developed a set of proprietary calculators that evaluate a number of factors to advise customers on the best deal to suit their individual needs.

The service is also available via telephone, fax and post. Consumers can call on 0800 093 06 07, fax 020 7233 5933 or write to Customer Services, uSwitch.com, 10th Floor, Portland House, Stag Place, London, SW1E 5BH.

uSwitch.com is not a supplier but acts as an independent advisor, giving customers an impartial view of what's on offer. Unlike traditional brokers, it compares prices from all suppliers, not just those it has a commercial relationship with. The service is based on the most up-to-date information provided by the supplier companies and industry regulators.

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