When you arrive in Estonia one of the things that might strike you at first is the number of SMS lenders available on the local market: SMS laen, credit24, omaraha and many more... the market is cluttered by those short term loans.
The reason is quite simple, locals are very fond of this easy money. Those loans are convenient and easy to get as companies are not very regarding in terms of assessing whether the applicants will be able to repay their loan.
It is also a neighboring country, Finland, that started to launch SMS loans a few years ago. Naturally the trend exported fast across the Baltic sea and Estonians quickly adopted and copied it.
Moving to other markets
Some other companies were quite smart and already realised that the market was crowded and decided to bring this innovation to bigger markets.
That was for example the case of TxtLoan that was founded in 2009. The company has now re-branded and is called Myjar. This company's success started another interesting trend in the country: tackling the UK market while based in Estonia.
This is true for payday lenders as you can see on this comparison site but also for peer to peer loans and other financial services: Bondora (P2P lender), TransferWise (send money abroad), Monese (bank account), Peachy (short term lender) and more...
Why the UK?
One would wonder why go to the UK when the currency is different and with such a geographical distance.
One of the main reasons is language. Most Estonians speak English, and very well. Few speak French, German, Spanish... so the easiest market to go at first is the UK, the US being too far.
The UK being a member of the EU also offers advantages and Estonia is a good home with low taxes and an affordable labour market full of young talented English speakers and developers full of innovative ideas.
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