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It has been some time since the UK bounced back from the recession. Now, the economy is managing the after-effect, and the country’s new leader is trying to do this by introducing severe austerity measures. These include slashes to public funds and tax increases. But is Britain getting any better at managing cash?

If the latest surveys are anything to go by, normal people in Britain are getting better at balancing their existing debts, but doesn’t automatically convey that they are not accumulating new ones. Saving has gone up, so obviously there is a pattern which proves that consumers are being more careful about how much money they spend. Yet a survey could simply attest to a general medium for an entire nation. In fact, personal debt is still rather steep and there are many individuals who have a hard time with money every day.

On an almost daily basis, there are fresh cautions about shady lenders like loan sharks, which sell criminal loans with bad credit to people who are really short of cash. Loan sharks are not registered as official lenders, and usually demand extortionate rates, which the borrower wouldn’t manage to pay back. When the victim lands in difficulty with the loan, the loan shark will either hand out more money at even higher rates or introduce violence to dictate settlement. It is never worth using a loan shark as the situation will inevitably end badly. Yet what about alternative independent loans available today? What exactly is possible and which loans are worth the while?

There are plenty of acknowledged loans on the UK loan market nowadays. These include payday loans or cash advance loans, logbook loans, personal loans and other types of specialist loans. They are not generally offered by traditional lenders however they are sold online or in television adverts. Payday loans are available to borrowers who do not hold a perfect credit score, or who may have been turned down for a loan from a high street bank.

So even if a person has been bankrupt or is unemployed, they will usually be accepted by loans bad credit lenders. Because the loan taker poses a higher risk to the payday loan lender, the interest rates on payday loans are usually a little higher than on other loans. This is because the borrower is more than likely to have some difficulty to repay the loan, based on their past experiences with credit products. By bringing in a slightly larger rate, the loan provider is dealing with the heightened risk level. On the other hand, payday loan lenders are (in most cases) fully legal lenders and won’t resort to any of the strategies utilized by loan sharks. To be sure, it is good news to an individual who is short of cash, that they could take a loan of up to 1,000 pounds and get the money in a short space of time. But if they have lots of existing debts, then it might be careless to apply for more loans.