Not all payday lenders will contact your employer, but some do choose to do so. Some lenders prefer to stick to traditional methods of identity checking, through requesting the provision of statements, payslips and bills. Others carry out a credit check to confirm your residency and financial history but still require proof of income and employment. Those that contact your employer to confirm your identity, residency and employment details can significantly speed up the loan process by removing the need for some potentially time consuming alternatives.
A Payday lender may contact your employer for the following reasons;
• Removes the need for statements and payslips etc to be sent back and forth
• Provides opportunity to check identity, residency, work and income
• Can provide an alternative to a credit check, although some providers do both to ensure responsible lending.
• Allows for the ability where streamlined for funds to be issued the same day as application.
Contacting your employer can at times remove the need of a credit check if your lender is not too concerned about your financial history, but more concerned with ensuring you are who you say you are and live where you say you live. However, most that contact your employer will also carry out a credit check, not to scrutinise on your history but just to ensure you are managing financially in the present. It’s part of the endeavour to lend responsibly.
As your employer are bound by the data protection laws, it is vital to let them know when a payday lender may be calling, and to authorise them to share the required information. Delay can occur if the information they need is not shared, or if your employer cannot be contacted.
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* Subject to Save My Bacon Ltd's right to request required information via fax, scanner or other paper means.