Complaints about payday loans fell over the last year
The Citizens Advice charity has announced that the number of complaints made about payday loans in the last year has almost halved, due to the Financial Conduct Authority (FCA) introducing new payday loans rules.
From January to March this year, Citizens Advice said they helped out with 5,554 payday loans problems, 45 per cent fewer than the same period in 2014. There were 10,155 payday loans problems reported to them last year.
In April 2014, the FCA became the regulator of the payday loans market, introducing changes to the rules such as limitations on adverts and also how many times a loan could be ‘rolled over’. Then, in January 2015, more laws were introduced, including limiting the maximum interest rate charged to 0.8 per cent, and also preventing anyone from ever owing more than double the amount they borrowed.
All of these changes, designed to toughen up on controversial lending practices, has contributed to the payday loans market shrinking. Only 247 lenders registered for authorisation in February, compared to almost 400 last year.
“The drop in the number of problems reported to us about payday loans is good news for consumers and demonstrates the impact a strong stance against irresponsible lending can have on people’s lives,” said Gillian Guy of Citizens Advice.