by Steve Beasant on 2 March, 2013
The impact of payday loans on personnel debt is having a dramatic effect and they are becoming one of the most popular causes of debt for people in the UK.
Debt charity the Money Advice Trust reports its National Debtline service took over 20,000 calls for help with payday loans in 2012, a huge record. The figure represents a 94 per cent year on year increase, and an increase of 4,200 per cent since the onset of the financial crisis in 2007.
In January this year, National Debtline took a call for help with payday loans for every seven minutes its phone lines were open.
The Money Advice Trust is calling on the Office of Fair Trading (OFT) to make use of new powers to suspend consumer credit licences with immediate effect where it identifies persistent bad practice.
Joanna Elson, chief executive of the Money Advice Trust, said: “Payday loans have come from nowhere to be one of the most common debt problems people face.
“The rapid emergence of payday lending has caught regulators a little off guard. We have waited some time for real action to be taken to help prevent people falling into a serious debt spiral with these loans.”Leave a comment