Payday loans more popular than ever
They’re the financial equivalent of a greasy burger from a manky caravan parked by the side of the road, but figures show that the payday loan is more popular than ever before.
This is in spite of APR rates of almost 2,500 per cent in some cases and their rise in popularity has been boosted by the fact that the high street banks are continuing to be miserly with their money when it comes to lending.
Consumer Focus have said that 1.2 million people are taking out payday loans every year, borrowing a total of £1.2 billion, figures that have quadrupled since 1996. As a result, Consumer Focus are calling for more safeguards to be introduced in order to help those borrowers who get out of their depth and are unable to meet repayments.
But many of those people only borrow small sums for short periods of time to tide them over, so are payday loans really as toxic a form of borrowing as the media makes out? Are they just a more legitimised form of the local loan shark or are they a necessary feature on the financial landscape?
Have any of you lot had a payday loan or considered getting one? If you have had one, did it make you feel dirty or did it get you out of a short-term pickle? Did you fall behind with the repayments and get a visit from a cricket bat-wielding man called Big Vern? Let us know in the box below…