SMS Loans Getting Swedes into Money Trouble

Young adults in Sweden are going into debt because of their cell phones. It’s not that they’re buying expensive handsets or spending a bundle on downloadable content. Nope. According to a report on TechRadar, they’re getting in trouble because of SMS loans, short-term, high-interest, unsecured loans that are as easy to get as sending a text message.

money_phone.jpgThere are some 30 companies in Sweden offering this type of loan.

The article cites an AFP-Reuters story saying the average loan is roughly $496, plus $91 in interest. And they really are short-term, with most requiring repayment within 30 days.

But it’s not as if the folks who indulge in these loans are actually paying them back. According to TechRadar, one Swedish collection agency alone was hired to recover money from 20,000 SMS loans.

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