DAWN Backs Calls for Tighter Payday Loan Regulation
A northern debt advice service has backed calls by a Government committee to bring in tighter regulation of the payday loans industry.
The House of Commons' Business Committee says the UK needs to introduce much tighter control of 'harmful debt service products', such as payday loans, which it says target vulnerable people and encourages them into debt.
And the call was backed by Liz Chadwick, chief executive of DAWN Advice, which operates the Northern Debt Line across the North East and Cumbria, who said the current trend in lenders offering short-term, high-interest loans was continuing to cause or contribute to debt problems across the country.
"I am pleased to see ongoing discussion at the highest levels about these loan offerings and that the Government is seriously considering banning these products, which are already being investigated by the Office of Fair Trading," she added.
"Not all borrowing is bad - it is fine when people have access to affordable lending, and when they are borrowing within their means.
"However, the idea of short-term lending is frequently anything but short-term - all too often it is an easy entry to a spiralling debt problem that quickly grows beyond the borrower's control.
"I would like to see the Government go further and ensure that affordable, responsible lending is made more readily available, through organisations such as Credit Unions, to people who need it and who can afford to pay it back.
"Anyone who has found themselves in difficulties after taking out a payday loan agreement shouldn't suffer in silence and I'd urge them to seek independent advice as quickly as possible to prevent their debts from escalating even further."
Anyone living in the North East who is concerned about payday loans or their financial situation should contact the Northern Debt Line for free, confidential and independent advice on 0300 3333 445 or visit www.dawnadvice.org.uk
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