Rush for loans as negative inflation means loan companies must pay borrowers interest

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Lenders ranging from banks to pay day loan companies are thought to be furious at news that negative inflation forecast for later in the year could mean having to pay interest to people who have borrowed from them.

Governor of the Bank of England, Mark Carney, explained that in a society such as ours that looks to fiscal forces in an almost God like Fashion with people worshipping at the altar of year on year growth, the new negative interest payments were simply two sides of the same coin like yin and yang.

“A £200,000 mortgage based on 3.5% APR could mean payments of £1000 a month. But if the apr becomes -3.5% the bank has to pay £1000 a month to you. So the more you borrow from them, the more they have to pay you.” He explained.

Indeed, one cheerful debtor told us “I’m quids in, I’m going to take out as many pay day loans as I can. And if I don’t pay back the capital then they have to pay me penalties.”

Within London’s square mile many financial institutions are thought to be keeping a stiff upper lip. A spokesman for HSBC told us that the bank had plenty of reserves to cover the unexpected payments.

“Don’t worry. We’ll just take it out of old people’s savings accounts.” He explained.

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