LONDON–(BUSINESS WIRE)–Cashfloat.co.uk, one of the UK’s leading online unsecured direct lenders, reported a record increase of over 270% in loan fee fraud attempts since the start of the coronavirus pandemic, with an average loss of £250 per victim.

The significant increase in loan fee scams can be attributed to two main factors:

1. COVID-19 – Due to the crisis brought on by the pandemic, more people are desperate for a loan due to salary cuts, job losses, and reduced work. Fraudsters are exploiting this by promising people a loan after other lenders have declined them.

2. Reduced lender activity – More unsecured lenders are now in administration. Those still in operation are working at a reduced capacity to minimise risk on loans being taken during these uncertain times.

Following an exhaustive investigation, the Cashfloat security team found that over 95% of loan scam victims applied on a

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