9 November 2016
Rhoda Grant has backed calls from a national debt advice charity for the Financial Conduct Authority to look at tightening the regulations around the payday loan market.
The call made in a report published by StepChange Debt Charity, the UK’s biggest debt advice charity, found that regulations had “not fixed” the payday lending market, with some payday loan providers still not engaging in best practise.
Last year, 9% of those who contacted StepChange Debt Charity from the Highlands and Islands Region had a payday loan debt, with their average payday debt balance at £855.
Although the charity has reported less and less people seeking help with payday debt, those who are turning to payday do not always get a fair deal.
“It is often the most vulnerable people who get caught up in the payday lending trap,” she commented, “and unless we ensure that best practice is followed by lenders the debt can quickly spiral upwards to unmanageable levels.
“If lenders will not do this voluntarily, then the Financial Conduct Authority must act to ensure that they properly look after their clients.
“I would advise people to look at other ways of accessing loans.
“Although it is not always possible if you are on a low income, try to plan for known events, like Christmas, and consider becoming part of a Credit Union which will help you do this.
“If you do get into difficulty, “concluded Mrs Grant,” the sooner you seek advice and help, from organisations like StepChange, Citizens Advice Bureau or Debt Advice Services provided by some local councils, the easier it will be to sort out.”