FURTHER REFORM AND REGULATION OF PAYDAY LOANS

It is good that there will now be something of a cap on the stratospheric interest-rates on payday loans.  However, much more needs to be done to prevent rapacious companies lending irresponsible sums of money to those who can ill-afford it.  Often these are people at the very bottom of the heap, already mired in debt and poverty.

There should be legislation to prevent companies lending to those who have no real chance of paying it back.  The conditions of lending should become more transparent, with no hidden charges.   And the lenders should not be encouraging their client into rolling over loans, thus creating Online Casino an ever-increasing spiral of  debt. There should also be much stricter regulation, so that the dodgier companies are forbidden to trade.

According to Which? Magazine, nearly a half of those who had taken out payday loans had been hit with unexpected charges such as high fees for reminder letters. When Which? Magazine analysed the websites of payday loaners, they found that most of them failed to show clearly their charges, or charged exorbitant amounts for defaulting.  Nearly two-thirds of the companies failed to ask about any aspects of their clients’ financial situation, apart from their salary.

Payday loans are used by more than a million people.