Payday loan firm boss denies ‘loan shark’ claims

The founder of payday loans firm Wonga has denied being a 'legalised loan shark'.

In a video interview with the Guardian, Errol Damelin claimed the company was helping people out when they are in a "stressful" situation.

The Guardian's Amelia Gentleman had carried out a study on the firm in March this year in which two of the four people the firm referred to her as case studies were in difficulties, with one being unemployed and the other, a nurse, off on long-term sick leave.

Mr Damelin claimed the firm had "tightened our systems" since this report and hinted such borrowers would have had their applications refused, although he declined to comment on the individual cases in question.

People struggling with debt may find matters get worse if they turn to payday lenders.

The Money Advice Trust recently revealed its National Debt Line saw a 116 per cent rise in calls concerning debt problems linked to payday loans in the first six months of this year, compared with the equivalent period in 2011.

By Joe White