Branches or internet better for loans?

Financial advice website Moneyfacts has launched an investigation into the better source for the provision of financial services such as personal loans – the internet or company branches.

The organisation claims that some of the major high-street banks have recently reversed their decisions to open more branches, perhaps in response to the growing popularity of online banking activity.

“For basic financial products such as savings accounts and personal loans, purchasing on the internet can offer excellent returns,” said Lisa Taylor of Moneyfacts.

“However, the internet market has failed to capture a large audience willing to select more complicated products such as mortgages.”

Ms Taylor points out that many mortgage providers offer application via the internet, but only three offer products that are exclusively available online.

Moneyfacts cites a number of examples where applying for an unsecured personal loan on the internet could be beneficial, the most notable being Abbey’s offering, which offers a typical rate of 6.1 per cent online for a loan amount of £5,000, compared to 9.9 per cent from a branch.