SGE aims to double workforce as demand for loans shoots up

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SIXTY jobs are expected to be created this year at a company which provides loans and helps people to cut their energy bills.

Sally Hill, the chief executive of the Leeds-based SGE Group, said the company hoped to increase its staff numbers from 60 to 120 over the next six months in response to demand. Over the last year, SGE’s turnover has increased from £1.8m to £3m.

SGE moved into a new call and administration centre in Burley Road, Leeds in November 2011. The company offers services to customers linked to energy switching, loan broking and gaming comparison.

Ms Hill said she welcomed an Office of Fair Trading (OFT) probe into payday loans firms. Some payday loans firms have been accused of giving people loans without making sure they can afford to pay them back, rolling over loans and charging interest rates running to several thousand per cent.

Apart from the OFT investigation, the Government is considering whether to give the OFT new powers to suspend credit licences. Ms Hill said she hoped new rules would be enforced to ensure that consumers take out just one payday loan at a time.

“The headcount at SGE is growing at 10 a month,” said Ms Hill.

“When a customer comes to us to apply for a loan, we look at trying to reduce the customer’s outgoings, as well as providing them with the financial product that they require. We work with about 25 lenders who offer a variety of loans. We’ve got about 500,000 customers altogether across the energy and finance sector.”

Ms Hill said that SGE only worked with three payday lenders.

She added: “A payday loan is a brilliant way of acquiring credit, because if you pay your loan back on time, it does increase your credit rating.”

She described the OFT investigation into payday loans as a “brilliant idea”.

She added: “One of the challenges of payday loans is that there isn’t any specific legislation to regulate them. It’s reliant on the Consumer Credit Act which was written before payday loans existed; because there isn’t any specific regulation to monitor that industry you’ve got lots and lots of payday companies who are interpreting the Consumer Credit Act in different ways.

“One of the problems, which hopefully will be diminished following the OFT investigation, is people getting multiple payday loans. What should be part of the new regulation is a limit to one payday loan at one period of time, so that a payday loan is used for what it was designed for.”

In May, payday lenders moved to head off the threat of tighter regulation by promising to do more to explain to customers how their loans work.

Four trade associations, representing more than 90 per cent of the payday and short-term loan industry, pledged to offer “practical help” for customers who are struggling to repay their loans.

Payday lenders have argued they want to maintain “high standards” and the industry generally has been unfairly tarnished. They say most customers are satisfied they are getting good value for money.

The agreement will be incorporated into payday lenders’ codes of practice by July 25.

It includes a customer charter to explain how loans work and the costs involved and there will be a commitment to inform customers three days before their money is withdrawn.

greg.wright@ypn.co.uk