When times are tough, or an unexpected expense crops up, borrowing can feel like the only option. It might start with a small loan from a friend, a favour from a family member, or a quick click on a ‘buy now, pay later’ button. But while these options might seem convenient, they can often create more problems than they solve.
At Northern Community Bank, we believe everyone deserves access to fair, affordable and safe ways to borrow money. We’re here to help you understand the risks of informal or unregulated borrowing, and show you how to borrow in a way that protects both your finances and your peace of mind.
The problem with borrowing from friends or family
Turning to someone you know can seem like a simple, friendly solution when you’re short on cash. But even with the best intentions, borrowing within personal relationships can quickly become complicated.
There’s often no written agreement or clear repayment plan, which can lead to confusion, frustration and strain on relationships. According to Fair4All Finance, around 21% of adults in the UK borrowed from friends or family in the past year. Of these, 16% who borrowed from friends and 8% who borrowed from family were charged interest, while 17% and 9% respectively said the relationship weakened as a result.
These statistics show that informal borrowing can affect not just your wallet, but your emotional wellbeing too. What starts as a favour can easily turn into tension or conflict, and that’s a cost no one wants to pay.
Illegal money lending is on the rise
More worrying still is the growing number of people turning to unlicensed or illegal lenders, often called loan sharks. The latest research from Fair4All Finance estimates that up to 1.9 million adults in Great Britain used an unlicensed money lender in the past 12 months.
The study also found that:
- 51% of people who borrowed from an unlicensed lender had previously been declined for other forms of credit.
- 65% had children to support.
- 38% had monthly incomes above £3,200 – showing this issue affects working families too.
Illegal lenders often appear friendly at first, offering quick cash when you feel out of options. But once you’re in, the repayments can spiral quickly, and the pressure to pay can be intense. These lenders operate outside the law, meaning borrowers have no protection or recourse if things go wrong.
Choosing safe ways to borrow money from regulated, community-rooted institutions like Northern Community Bank ensures you’re protected, supported and treated fairly at every step.
The hidden risks of Buy Now, Pay Later
‘Buy Now, Pay Later’ (BNPL) schemes have become a popular way to spread the cost of purchases. But while they can seem harmless, they are still a form of borrowing, and one that’s easy to underestimate.
Because repayments are often small and spread out, it’s easy to lose track of how much you owe across multiple platforms. Missed payments can lead to fees, credit score damage, and a snowballing cycle of debt.
Using BNPL responsibly requires the same care and planning as any other form of borrowing. It’s worth taking a step back and considering whether there might be safer, more transparent ways to borrow that give you full control over your repayments.
A fair and affordable alternative
At Northern Community Bank, we offer safe ways to borrow money that are designed to work for you – not against you. Our loans are transparent, affordable and built around your circumstances.
Here’s what makes borrowing from us different:
- We’re regulated – Your loan is protected by the same standards that govern all responsible lenders.
- We’re part of your community – We understand real-life pressures and make decisions based on your needs, not profits.
- We’re supportive – We’ll talk you through your options, help you budget for repayments, and never push you into borrowing more than you can afford.
- We’re clear and fair – You’ll always know what you owe, when it’s due, and what it will cost, with no surprises.
Whether you’re planning for something special or facing an unexpected bill, we’re here to help you borrow in a way that feels safe, manageable and empowering.
Taking control of your borrowing
If you’re already borrowing, or thinking about taking out a loan, it’s worth checking:
- Do I really need to borrow?
- Can I afford the repayments comfortably?
- Am I borrowing from a regulated, trustworthy source?
And if you’re worried about existing borrowing, from friends, family, or elsewhere – we’re here to help. Talking to us early can make all the difference.
At Northern Community Bank, we don’t just lend money. We help you make confident choices that protect your financial wellbeing. Because finding safe ways to borrow money shouldn’t feel out of reach, it should feel simple, fair, and part of the community you live in.
