Financial Jargon
Speed-e-loans.com's instant loan service has been designed to be as simple and clear as possible to use. You won't find lots of confusing bank-speak with us! Pity we can't say the same for others, so here is how to crack the bank code!
ACH - Automated Clearing House
They look after the millions of electronic cash transactions that happen every day. The UK's automated clearing house is BACS Ltd, which is owned by a load of banks and financial institutions for the payments industry.
AER - Annual Equivalent Rate
This represents the interest rate you would get if the gross interest was paid and compounded annually. It's designed to compare the annual interest between savings accounts or investments on a level playing field. It doesn't generally incorporate one-time charges, such as a sign up fee, which sort of defeats the point of it.
APR - Annual Percentage Rate
APR stands for annual percentage rate and is the interest payable on the amount borrowed and other charges expressed as an annual rate of charge. It assumes that a financial transaction lasts for a year - which a speed-e-loan doesn't. See more on our Explain APR page.
BACS (formerly) Bankers Automated Clearing Service
A BACS payment is an electronic credit paid directly into a bank or building society account in the UK for a specified amount. The service is provided by BACS Ltd and the process takes around three days to clear. That's obviously much slower than a fast speed-e-loan, because successful applicants receive their cash within two hours!
Base rate
The standard interest rate from which lenders set their rates for lending and saving products as set by The Bank of England.
CAB - Citizen's Advice Bureau
This helps people resolve their legal, financial and other problems by providing free, independent and confidential advice. It's an organisation that's part charity and part government-funded.
CCCS - Consumer Credit Counselling Service
The CCCS is a registered charity whose purpose is to assist people who are in financial difficulty by providing free, independent, impartial and realistic advice.
CCJ - County Court Judgement
These are not good. If you are in arrears, a creditor can take a County Court action against you, to claim the money back via the courts. This will then be shown on your credit file for 6 years and will impair your ability to obtain traditional credit. Under Scottish law claims are dealt with differently, by the Sheriff Court.
CHAPS - Clearing House Automated Payment
These enable payments to be transferred from one bank account to another on the same day - if the instruction is made before 3.30pm on a week day.
Chip and PIN
Chip and PIN is a payment system designed to reduce card fraud. A chip and PIN card has a 'smart' chip that holds your four-digit Personal Identification Number (PIN). When you pay in a shop with a chip and PIN card, you are asked to enter your PIN into a keypad instead of signing a receipt. This PIN can also be used at cash machines to withdraw money.
Consumer Credit Act
The Consumer Credit Act 1974 requires most businesses which offer goods or services on credit, or which lend money to consumers, to be licensed by the Office of Fair Trading (OFT). Trading without a licensing arrangement is a criminal offence and can result in a fine and/or imprisonment.
Credit rating
A credit rating assesses the credit 'worthiness' of an individual, corporation, or even a country. Credit ratings, also known as credit scores, are calculated from a number of factors including financial history and current assets and liabilities. Typically, a credit rating tells a lender or investor the probability of the subject being able to pay back a loan.
Credit reference agency
A credit reference agency is a company that collects information from various sources and provides information on individual consumers for a variety of uses. This information, sometimes in the form of a credit rating , helps lenders assess credit worthiness and the likely ability of someone to pay back a loan. Examples of credit reference agencies in the UK are Callcredit, Experian and Equifax.
Direct debit (DD)
An instruction from you to your bank or building society that allows someone else to take money from your account. The amount of cash taken can vary, but you must be told of the amounts and relevant dates before the money is removed. Direct debits allow you to pay regular bills automatically for example.
Loan period
The time for which money is borrowed, or the period over which payments are made until the loan and interest is fully settled. Another term for loan period is repayment period. Speed-e-loans.com loans are short-term and the selected loan period can be between five and 30 days.
Nominal annual rate
The rate of interest that would apply if the interest was not added each year and if there was no inflation.
OFT
The Office of Fair Trading was established to promote fair credit arrangements for UK consumers. Speed-e-loans.com are regulated by the OFT.
Online payday loans
This is exactly what speed-e-loans.com do! Most companies want copies of cards and faxed payslips, but not speed-e-loans.com. We are a 100% online except in the most exceptional of circumstances.
Overdraft
An agreed amount that your bank has permitted you to go overdrawn. This is an authorised overdraft or sometimes called authorised borrowing. It is much cheaper than unauthorised borrowing (see below).
p.a.
This stands for per annum or per year.
Payday loan
Also called a payday advance, it's a loan that's intended to be taken only until the next or the following payday.
PIN - Personal Identification Number
A PIN is a four-digit secret number that you input into a cash machine or pin pad at a checkout desk to verify and authorise a card transaction.
Standing order
A regular automatic fixed payment from your bank to a third party that you have agreed to make.
Short term loan
Banks usually think of anything under a year to be short term. Speed-e-loans.com defines it as a loan until your next pay day, usually for a term of less than 30 days.
Unauthorised borrowing
An overdraft that is for more than your bank has agreed to. It is also known as unarranged borrowing, or unauthorised overdraft. It usually carries a higher rate of interest plus additional fees.
Variable-rate interest
A rate of interest that is applied to a mortgage or loan that can go up or down. This is usually a rate set by the Bank of England.
