Risks & Benefits
We’re really excited about helping you on your journey to living a richer life. As with many things, it’s important to understand the benefits as well as the risks, before setting off. We’ve put together this helpful table to show you the benefits of joining Loqbox, as well as where there may be risks that you might want to be aware of. If you have any questions, please ask our support team, who are happy to help.
Risks
- Building a credit history is one of the best ways to improve your credit score, but we can’t guarantee any results. Therefore you may not see the score improvement you are hoping for, or in the timeframe you are hoping for.
- If you miss any payments to Loqbox Save or Loqbox Grow these will be reported to the three main credit reference agencies. This would hurt your credit score, just like missing payments to any other credit providers would.
- Actions you take in the rest of your financial life can impact your credit score improvement. For example, missing payments on other accounts or entering Bankruptcy. For more information on when a Loqbox feature may not be the best solution for you, please see below.
- Adding new lines of credit to your credit file, can, in some circumstances, cause your credit score to drop temporarily. This is for two reasons. First, because new lines of credit reduce your average account life across all of your accounts. And in the case of loans, lenders aren’t yet sure how you’ll perform in paying it back. As Loqbox Save is a digital saving voucher, you may see a temporary drop in your credit score when using this feature. This temporary reduction in score is likely to be reversed within four months.
- Loqbox Save and Loqbox Grow are not regulated by the Financial Conduct Authority (FCA). Any complaints about these products would not be eligible to be reviewed by the Financial Ombudsman Service.
- When using Loqbox Save without a Full membership to Loqbox, at the end of your credit building journey and in order to use this service for free, when you come to redeem your Loqbox Funds, you must open a bank account with one of our partner banks. Opening a partner bank account is free, can usually be completed in a few days, and results in you having access to your savings straight away. We get paid a commission by the partner bank, and this keeps the service free for you. Partner bank accounts can be closed immediately should you wish. Or if you prefer to use an existing account, it's just £30 for your Loqbox credit-building, saving and financial guidance journey.
Benefits
- On average, people who use our Full Loqbox membership, and make payments on time when managing other credit commitments outside of Loqbox, will see an increase of 197 points on average to their credit score within 12 months.
- On average, people who use our Lite Loqbox membership, and make payments on time when managing other credit commitments outside of Loqbox, will see an increase of 145 points on average to their credit score within 12 months.
- Using Loqbox Save or Loqbox Grow will build your credit history with all three credit reference agencies. Payment history, score credit history, makes up more than 30% of your credit score so building your payment history is a great way to impact your credit score.
- There is no interest or charges associated with either Loqbox Save or Loqbox Grow features.
- Full membership to Loqbox gives you access to all of our credit building and financial wellbeing services.
- Lite membership to Loqbox gives you access to Loqbox Save, Loqbox Learn and Loqbox Coach.
- 80% of our members say they are more motivated, confident, or knowledgeable about their finances after using Loqbox for at least four months.
- After at least 6 months of using Loqbox, of the members who tried to access credit, over 40% of full members, and over 30% of lite members, succeeded in accessing credit.
- Our Net Promoter Score is 65. This is excellent and means that most of our members would recommend us to their friends.
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