According to new research by the Citizens Advice, at least 76 per cent of people who have lodged cases with them in relation to payday loan companies in the first six months of this year, have grounds for an official complaint to the Financial Ombudsman.
There were a number of different reasons cited for customers’ complaints to Citizen Advice, including potential fraud cases. A whopping 20 per cent of the complainants were reportedly being chased for payments on money they had not actually borrowed.
It’s probably fair to say that very few people would relish the thought of taking out a payday loan to make ends meet for that last, pesky week of the month.
Infamous for the sky high interest rates, payday loans can easily lead to a downward spiral of increasing debt, so approach with caution!
If you need some fast cash, the first things to do is consider all the potential alternatives – and if you do go ahead with a payday loan, make sure you will be able to pay it back on time, as per the original agreement.
Or quite a lot of help, as the case may be – with UK households reportedly borrowing around £2,000 each from family and friends in order to make ends meet.
According to the Aviva Family Finances Report, the average household debt has risen by 40 per cent, from £9,000 a year ago to £13,000 now, with around £2,000 of the latter being owed to family and friends.
If you are thinking of borrowing money from someone close to you, it might be worth checking if there is a better solution to help you get on top of your finances.