178% rise in payday loan complaints

26 May 2016
178% rise in payday loan complaints

Consumer complaints about payday loans have tripled over the past year, even though there's been a crackdown.

Financial Ombudsman Service figures show that complaints over payday loans went up 178% per cent in the year to April.

This isn't all necessarily gloomy though. This spike in complaints reflects “people's growing awareness of their rights when things go wrong", according to the Ombudsman.

Around 3,210 payday loan complaints were made, which is up from 1,160 in the previous financial year. In addition to that, general complaints with credit products as a whole went up 40% in the same period.

Thanks to tough new rules, the amount of payday loans being issued decreased dramatically, going from from 6.3m in the first half of 2013 to 1.8m in the same period last year, according to the FCA.

Many payday loan companies are being closed down, or find themselves unable to operate with the new rules.

Of course, PPI complaints still massive outweigh gripes about payday loans, with the ombudsman receiving up to 4,000 cases a week, with the banks involved in this, putting aside a collective £30 billion in compensation.

TOPICS:   Complaints   Banking

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