Monday 30th June, 2008 Debt Management News

Payday loans are becoming more popular as the UK feels the pinch form the credit crunch, according to recent research.

Price comparison site, Moneysupermarket.com revealed that the number of payday loans taken out since last August has rocketed by 130%. The impact of the credit crunch means that cheap credit is less available than it was and as a result more people are turning to expensive payday loan companies.

It goes without saying that payday loans are a very expensive form of debt management and should be avoided by those struggling with debt. Unfortunately, there appears to be little relief on the horizon, due to the current state of the economy, for those who are struggling with mounting debt.

Payday loans and similar types of loans attract interest rates in the region of 1,355%. This extremely expensive credit is taking advantage of the most vulnerable people in society and profiteering from their financial misery. Responsible lending, where the creditor looks at the borrowers ability to pay back the loan, seems to have disappeared.

Debtwatchdog demands that these types of companies should address their lending practices. They are no different from drug dealers peddling their misery on their addicted victims. Legislation should be brought in to put an end to the debt pushers making a fortune from other people's misery.