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Payday loan complaints reach five year high

edited 30 November -1 at 1:00AM in Loans
42 replies 3.2K views
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  • parking_question_chapparking_question_chap Forumite
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    Turtle87 wrote: »
    If only they were responsible lenders in the first place

    Or perhaps if their customers were responsible spenders and lived within their means in the first place, they wouldnt have needed a payday loan.


    I appreciate thats not all people and some are hard up through no fault of their own. But so many people are all about the spend spend for the latest products. Then try and work out how they can pay for it later.
  • Turtle87Turtle87 Forumite
    38 posts
    In some cases this will no doubt be true BUT it’s a generalisation. Cases are circumstantial why people took out multiple loans however, this doesn’t mean the lender can lend irresponsibly.

    My understanding of upheld affordability claims is mostly cases where multiple loans were taken out one after the other over a long period of time, not the odd loan here and there. When this happened the lenders failed to make the NECESSARY checks.
  • BermoniaBermonia Forumite
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    Turtle87 - so you are unhappy with a generalisation of people who use payday loans but are more than happy with the generalisation of payday lenders?

    Keep in mind payday lenders are required to make ‘proportionate’ checks, given the turnaround time usually required for payday loans it would be impractical to request evidence of someone’s income and expenditure purely because people do not want to provide true and accurate information as part of their application.

    Whilst I fully accept some practices could be better, people have to take responsibility for their actions - after all they are surely best placed to consider their circumstances before applying.
  • Turtle87Turtle87 Forumite
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    Correct. Based on there being millions of individuals who take out payday loans and only approx 50 payday lenders in the UK.

    I don’t know why anyone in their right mind would support these rip off practises. They barely existed 10 years ago and people survived. Now you can’t watch the TV without seeing them being advertised.

    I agree that people have to take responsibility for their actions but what has been happening is payday lenders funding people to live off these loans one after the other over a long period of time without any questions being asked.

    In these cases, rightly so you should get the interest paid back. As I’m sure you’re aware, often in these cases the interest paid on the first 2/3 loans is not refunded as the proportionate checks were made by the lender. Just nothing was done after these.
  • kelevrazkelevraz Forumite
    192 posts
    Turtle87 wrote: »

    I don’t know why anyone in their right mind would support these rip off practises. They barely existed 10 years ago and people survived. Now you can’t watch the TV without seeing them being advertised.

    Actually, people just went to normal loan sharks.

    The difference being that a loan shark would then show up to your house and intimidate you / get violent with you. There's always been a 'market' for people who cant get 'normal' loans.
    Turtle87 wrote: »

    I agree that people have to take responsibility for their actions but what has been happening is payday lenders funding people to live off these loans one after the other over a long period of time without any questions being asked.

    In these cases, rightly so you should get the interest paid back. As I’m sure you’re aware, often in these cases the interest paid on the first 2/3 loans is not refunded as the proportionate checks were made by the lender. Just nothing was done after these.

    As ive said before, i don't support them, but their demonisation only gives people the impression that THEY are the victims, how so? You, of your own free will, sign up, and take a loan thats too expensive, and then when you cant pay it back, its somehow the lenders fault?

    When you say they have been 'funding' people, i think you need to be clear about the fact that people CHOOSE to go back to them, i don't remember ever hearing of a single case where a pay day lender has just 'put' money in your account and then forced you to pay it back with a stupid interest rate, have you?
  • edited 16 May 2019 at 10:06AM
    Turtle87Turtle87 Forumite
    38 posts
    edited 16 May 2019 at 10:06AM
    So illegal loan sharks set a precedent? Wake up.

    Approx x10 people use pay day lenders (2 mill) in comparison to illegal loan sharks (190k).

    Yes it is the lenders fault in these cases I’m talking about (repeat lending and increasing loan amounts over a long period of time). This is EXACTLY why they are being instructed to refund the interest by the FOS. The loan was not affordable. It's pretty simple to understand.

    As someone who has dealt with pay day lenders and "experienced" the way they operate, I know exactly what they’re like. They are sharks in suits. How many times have you had loans from them? Let me take a guess....0?
  • NasqueronNasqueron Forumite
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    Don't get me wrong. There is a definite market for PDLs. It does protect consumers from having to use loan sharks. But the need for PDL companies to properly check income and affordability is so much more necessary than if you or I apply to a high street bank for a loan. That is because PDL companies target particularly vulnerable consumers, whereas high street banks do not. There is a specific need for the PDL income/affordability checks to be so much more thorough than that carried out by high street banks. It is to protect the most vulnerable in society... (imho)


    Yes I agree, hence the issue with something like the FCA making sure they follow the rules with suitable fines. I think the recent cap (proposal? law?) on maximum borrowing amount is sensible.
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  • kelevrazkelevraz Forumite
    192 posts
    Turtle87 wrote: »
    So illegal loan sharks set a precedent? Wake up.

    Approx x10 people use pay day lenders (2 mill) in comparison to illegal loan sharks (190k).

    Yes it is the lenders fault in these cases I’m talking about (repeat lending and increasing loan amounts over a long period of time). This is EXACTLY why they are being instructed to refund the interest by the FOS. The loan was not affordable. It's pretty simple to understand.

    As someone who has dealt with pay day lenders and "experienced" the way they operate, I know exactly what they’re like. They are sharks in suits. How many times have you had loans from them? Let me take a guess....0?

    I've had in excess of 30 payday loans in my time.. All between the ages of 18-20.. nearly half of the loans i took i actually got while i was unemployed

    a PDL got through to me about 6 years ago and offered me a refund of around £400 or so, saying they had basically 'done the maths' and figured out that i had overpaid on past loans, of course i accepted it, but i never applied for it, didn't even realise at the time how big the whole cracking down on PDL was going to become.

    W***a emailed me literally a couple of weeks ago, advising me that i 'may have a claim' (hence my post up there), haven't bothered responding to it as frankly i just don't care lol

    So, as someone who has dealt with pay day lender and "experienced" the way they operate first hand (As you say), i can comfortably and with no reservation say, that i was always well aware of what i was doing, i was always well aware that the rates were absolutely exorbitant, there were times i took loans KNOWING i'd have a problem paying them back (but thats a problem for future me to worry about...)

    No one ever forced my hand in taking one. And clearly, unlike some... i'm not and have never been in the habit of trying to convince people that don't have a grip on their finances, that it's the PDL fault that they made things worse for themselves. Ever heard of the expression borrowing from peter to pay paul??

    To caveat that, what would i have done without PDL? No idea, in reality - my credit file would've taken a beating much SOONER than it did. The fact i (And other people) lived/live way outside of my means was always going to end in tears, as someone above mentioned, all it did was delay the fact i'd have to eventually face up to it.
  • SystemSystem
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    Turtle87 wrote: »
    I don’t know why anyone in their right mind would support these rip off practises. They barely existed 10 years ago and people survived.

    People used Shopacheck and Provident doorstep sub-prime lenders who had been on the go for decades, both of whom had infinitely more shady practices than most payday lenders especially when it came to top ups. As the internet wasn't as widely used by people back then they got away with it.

    Sub-prime payday loan type lenders have existed for donkeys years, the only difference is today they're now on the internet.
  • SystemSystem
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    Turtle87 wrote: »
    So illegal loan sharks set a precedent? Wake up.

    Approx x10 people use pay day lenders (2 mill) in comparison to illegal loan sharks (190k).

    There was a case in the Hull Daily Mail a few years ago of a loan shark who got sent to prison. He would charge double what was borrowed so to borrow £100 you'd repay £200. When you calculated the interest rate it made him look like bargain of the century compared to payday lenders and indeed many of the comments on the article on their website said the same. Had he not got a bit lairy with a couple of defaulters he would have probably still had a decent client base who were being provided a much better deal than Wonga et all.
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