Clamp down on payday lenders

Britain's biggest payday lenders have been threatened with being put out of business after a damning report by the Office of Fair Trading uncovered evidence of "widespread irresponsible lending".

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Key findings of OFT report into payday lending sector

The UK's 50 biggest payday lenders have been given 12 weeks to change their ways or risk their licenses after the Office of Fair Trading uncovered evidence of "widespread irresponsible lending".

Particular areas of non-compliance included:

  • 30 of the 50 websites looked at emphasised speed and simplicity over cost -in some cases making claims that, it true, would amount to irresponsible lending.
  • Lenders failing to conduct adequate assessments of affordability before lending or before rolling over loans.
  • Failing to explain adequately how payments will be collected
  • Using aggressive debt collection practices
  • Not treating borrowers in financial difficulty with forbearance.

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