Payday loan warning issued after Brent resident ends up owing £20k
- Credit: Archant
Brent Citizens Advice Bureau are issuing a payday loans warning after learning of a resident whose debt snowballed to £20,000 after borrowing just a few hundred pounds.
Figures from the CAB’s national payday loan tracker show seven out of 10 borrowers were unable to pay back their loan.
The survey also claims 65 per cent of lender failed to make financial checks.
The statistics were retrieved from an analysis of the first four months of national findings based on feedback from customers who took out 1,270 payday loan from more than 87 different payday lenders between 26 November and 31 March.
During the same time period more than 11,000 people sought online help from CAB about payday loans.
According to the CAB there has been a ten-fold increase in payday loans in the last four years.
Samia Badani, Brent CAB’s social policy coordinator, said: “Day in day out we see people battling with payday loan debts.
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“Many have been able to take out a loan despite it being quite clear from their finances that they’ll struggle to pay it back.
“It’s very disappointing that payday lenders are not asking borrowers about their financial situation to see if they are able to repay the loan especially given they have vowed to do so.
“Payday lenders need to take their pledge to treat people fairly seriously by and making sure they check the loan is affordable and help those who struggle to pay back the loan.”
The survey will run until the end of the month.
You can take part by visiting http://www.adviceguide.org.uk/dialogue_payday_loan_survey.