A council-backed campaign group has been set up in the north-west of England with the intention of raising awareness about the dangers of taking out p…
A council-backed campaign group has been set up in the north-west of England with the intention of raising awareness about the dangers of taking out payday loans.
The Wigan & Leigh Debtbusters organisation was established by Unify Credit Union, Citizens Advice and Wigan & Leigh Cooperative Party and was officially launched last weekend (March 2nd), the Manchester Gazette reports.
Despite the astronomical interest rates being offered, there has been a worrying rise in the number of people taking out payday loans throughout the UK. Indeed, the Money Advice Trust recently confirmed it received more than 20,000 calls from stressed residents who required help with this type of loan.
It is clearly a growing problem in Lancashire and leaders of the Debtbusters group are keen to point out that struggling households should seek professional debt management advice before they do something they are likely to regret.
According to the Office of Budget Responsibility, levels of personal debt are expected to rise by 36.3 per cent in the next three years, which will inevitably plunge even more Britons into financial trouble. The organisation stated that more than one in three people are already worried about their arrears and 43 per cent expect their problems to worsen in the next six months.
Alarmingly, nearly half of the population has run out of money before their wages go into the bank each month. This has led to a rise in the number of "zombie debtors", who are only able to service their debts, rather than settle them.
One in three Britons who take out a payday loan admit that they could not pay it off, so they had to take out another one. It is easy to see why people are drowning in debt and Jo Platt of Debtbusters said it is high time unscrupulous loan providers were brought to book.
"Residents of the borough are calling for action against legal loan sharks," she said. "Over the past couple of years they have proliferated in our area and the tough financial times means more and more people are turning to them and the extortionate loans which they offer."
By Joe White