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Creditfix LB 03-2017

Payday Lender Complaints Treble

The number of official complaints against payday loan companies more than trebled over the last year.

The latest figures released from the Financial Ombudsman Service show that 10,529 official complaints have been received against the short-term loan companies, up from 3,216 the previous year.

Various complaints were made, including high loan costs and extortionate interest rates on the loans.

Perhaps the most serious complaints concerned lenders taking money from customers’ accounts without permission.

59 per cent of the complaints against payday loan companies were upheld by the financial ombudsman.

It is thought that the huge rise in complaints is partly down to loan customers being more aware of their own rights and the loan companies’ activities.

Many of the payday loan companies have been keeping a low profile in recent times, after the amount of bad press received in particular by Wonga. The companies had seen a meteoric rise since the global financial crisis of 2008.

Many consumers have been seen to take on more household debt since the Brexit decision last year.

Over the year a total of 321,283 complaints of all types were received by the free ombudsman service.

Still by far the largest type of complaint was over payment protection insurance as the scandal carries on. This type of complaint made up 53 per cent of the total received.

CEO of the Financial Ombudsman Service, Caroline Wayman, commented: ‘It’s clear that financial difficulties and financial exclusion remain significant challenges for many people. But the important thing is to speak up if you are struggling.’

She continued: ‘ Money is complicated and our job is to unravel what’s happened and find a way to put things right by looking at individual complaints.’

If you have a complaint of a financial nature, the Financial Ombudsman Service is free to contact and use.

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