SMS loans are becoming a national problem for Estonia

Although providers of SMS loans charge up to 1,000 percent a year in interest, almost one in every ten Estonians has applied for such a loan, reports Baltic Business News.

It only two years since that the first companies started to offer SMS loans in Estonia this has grown into a business worth at least a billion kroons.

It is believed that the market share of SMS Laen is more than 50 percent in Estonia. There are about ten companies offering SMS loans in Estonia today.

Since about 10 percent of the people who have taken an SMS loan have problems in repaying the debt, this means that also debt collection agencies have plenty of business.

“The number of small borrowers in trouble is increasing,” confirms Jaanus Laidvee from debt collection agency Julianus Inkasso. In average, customers in trouble owe between 20,000 and 25,000 kroons ($1,600 and $2,100).

Related:

-- Mentally ill person can take a SMS-loan in Estonia

-- Young Estonian became a drug mule for a large SMS loan

-- Finns struggling with SMS loans

-- Loans by text message send young Swedes spiralling into debt

-- $300 Loans by Simply sending a Text Message

-- SMS loans could be ruining your Christmas season

-- Finland Should Ban Late-Night SMS Loans, Justice Ministry Says

emily | 7:56 AM | SMS and Banking |
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