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Unsecured loans given without proof of income, says

More than two-thirds of the money lent in unsecured loans in the last year was granted without consumers being asked to prove their income, says

The independent price comparison site says lending on unsecured loans totalled £29.9bn, but’s latest research shows almost £20.9bn or 70% of this was issued without proof of income.

The site says 15% of successful applicants were not even asked how much they earned on the application form.

The percentage of consumers who were not asked for proof of salary is identical to the amount revealed in the November 2006 report. says the banking industry has previously tried to discredit the issues raised in this study by claiming that most customers apply to their existing bank for credit.

The site says if this is the case, the bank should probably have income and affordability data on the customer and therefore would not necessarily need to ask for it again.

But this year’s study reveals that 45% of loan applicants did not apply for the loan through their bank, so the lender would have had little or no information about the applicant’s income or financial commitments.

Mike Naylor, personal finance expert at, says: “With more than 7,716 loan repayments being missed every day and record write-offs, you might think that lenders would have learnt their lesson, but the potential profits have clearly been too good to resist.

“While the credit crunch has forced lenders to tighten up their lending criteria, these latest amendments to the Banking Code do not go far enough to help promote responsible lending in all cases.”


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