Singing Pig

Hi KiG

Definitely not pie in the sky.

However, I see a couple of potential flaws in your strategy, regarding the hours you can put in.

First of all, will you be able to take loan applications during your working hours? (ie can you answer your phone when you are working. If not, is there someone at home who can take the calls (ie the missus)

Secondly, is there no way you can do 1-2 hours Mon-Friday? The reason I say this is many clients you receive will be on low-income benefits. If they get their money on a Monday, and you can't visit to collect until Wednesday, the client will more than likely have spent it. This will dramatically affect your collection-ratio. Again, if this is not possible for you, is there a friend/relative who could help.

As your client base increases, you will obviously need to put more time into this business. For instance, on average it takes me 1 hour to collect from 10 clients. If you have 20 per day, then 2 hours will be required.

However, you will have some fortnightly, monthly payers, and some of these will pay by standing order.

It's definitely achievable, and, will be hard work in the first year, but you will get to your goal..ie Ditch the 9-5. It's a great, but sometimes scarey, feeling.

When are you looking to start the business?

Ade
 

 

Hi Tass,

 I agree with you regarding the possible flaws to my strategy.  Thankfully, I think I may be able to handle calls at work (although I may have to employ a cloak and dagger strategy here, hiding in the store etc!!)

The hours are less flexible, and I do see your point on the necessity to collect money when the clients have it.  I may have to look into the possibility of employing a collector, and would love to hear of any experiences anyone has had with this route.

What I do see as a bigger stumbling block is my catchment area.  I did mention before that it comprises of 2 towns, with a combined population of 20000.  However, these towns are not made up of solely low income households, but include many people who would not need such a service. 

What numbers do you guys work from?  Is anyone being successful working off relatively low numbers?

Finally Tass, as regards when I intend to get going, the simple answer is "I don't know!!"  I suppose I'm still very much at the stage of working out whether or not this is viable for me and my situation.  I am always open to suggestions from everyone...perhaps there is an optimum time in the year for begining such a venture.

Finally, thanks everyone for your time in answering my questions.  Your help is much appreciated.

Keep it Goin'

KiG

I have 200 clients from a catchment area of 4800 houses, so I don't think there is any concern there.  What is the mileage from the two towns?

With regards to the collector, I doubt this would be possible initially, and that is why I mentioned realtives/friends who could help.

I paid my agent 8% of cash collected (industry standard 7%). In the first few months, it won't be worth an agent's while..

I don't really think there is an optimum time to start this business. I started October, which suited me, as I was trying to build the business quickly and the run up to Christmas helped that out.

Give Craig a call and go from there

As you are contine to work, I would suggest starting after Christmas...

Ade

Tassotti:

Hi Danny I don't actually get that many referrals. When my good clients have spoken to me about giving my number to their friends or family, they are usually quite nervous about it. There is no guarantee that the referral will also be a good payer and the existing client does not want it to look bad on them.

Without advertising, it would take years to build up my client base to where it needs to be. I want it to happen soon (by March)

I know I will get hit with a load of new bad payers, but, hopefully,  I can keep these to a minimum with my lending decisions. I actually turn away a lot more people now than I used to.

I find this to be the hardest thing. You never know if the new client will be good or bad. Credit checks can be performed, but the sort of people using this service are more than likely to have a bad credit rating anyway. Some of my best payers have openly admitted they have CCJs.

Its a bit of a gamble really, but, as aforementioned, its a numbers game, and as long as the good payers outweigh the bad, one will have a successful business.

Tass
 

We do have a great way of aquiring/assessing customers and making a profit at the same time. The information is included in our training prog.

Hi,

New to this, but very interested.

Does anyone have experience of getting he new competence-based CCL? I've read the OFT website that says applicants may be asked for evidence of competency, but I can't find anywhere what that evidence might be. I can't even find anyone offering specific training (I've seen your advert BizzyBee, but it's very non-specific).

Any advice welcome, or please point me to the right thread if this isn't it.

Thanks!

Chris

Hi Chris.

Give the Consumer Credit Association a try (CCA) regarding the competence.

We all got our licences before that came in.

Cheers.

Craig

ChrisH:

Hi,

New to this, but very interested.

Does anyone have experience of getting he new competence-based CCL? I've read the OFT website that says applicants may be asked for evidence of competency, but I can't find anywhere what that evidence might be. I can't even find anyone offering specific training (I've seen your advert BizzyBee, but it's very non-specific).

Any advice welcome, or please point me to the right thread if this isn't it.

Thanks!

Chris

I am still investigating this, but at the moment, as craig pointed out, not many people have had to obtain a licence under the new system. You could have a look at this pdf from the OFT see what you can make of it.

http://www.fisa.co.uk/downloads/oft969.pdf

ChrisH:

Hi,

New to this, but very interested.

Does anyone have experience of getting he new competence-based CCL? I've read the OFT website that says applicants may be asked for evidence of competency, but I can't find anywhere what that evidence might be. I can't even find anyone offering specific training (I've seen your advert BizzyBee, but it's very non-specific).

Any advice welcome, or please point me to the right thread if this isn't it.

Thanks!

Chris

 Ok. these are the two additional forms (over and above the licence application) that you will need to complete; to operate in the business categories that are applicable to the home credit market. It is my understanding that you will need to complete both these forms. I also note that some of the questions are difficult to negotiate due to their vague nature, but they are by no means insurmountable.

http://www.oft.gov.uk/shared_oft/business_leaflets/credit_licences/CCP1.pdf

http://www.oft.gov.uk/shared_oft/business_leaflets/credit_licences/CRP1.pdf