Don’t let the loan sharks ruin your Christmas

Predictions that 80,000 people will become fresh victims of illegal lenders this Christmas has led the Office of Fair Trading to issue a warning to consumers http://www.bbc.co.uk/news/business-12014416

The warning has the full support of national free debt solutions provider Payplan who’s counsellors will be taking hundreds of calls for debt help come the New Year.

“It is the worse time of year – straight after Christmas,” says Payplan MD John Fairhurst. “Our counsellors listen and advise people who are in the depths of despair, in real misery, and who have nowhere to turn.

“A growing number of callers will have used a loan shark to raise cash for presents and festivities. But what may have seemed the ideal solution at the time can lead to deprivation and personal debt in the new year when the real cost of the borrowing is realised.”

According to Policis, the research organisation analysing illegal lending for the government, a £100 of borrowed money could cost almost £400 to pay back once the loan shark’s interest fees are factored in.
http://www.bis.gov.uk/assets/biscore/consumer-issues/docs/i/10-1186-interim-evaluation-illegal-money-lending

The number of households using loan sharks has nearly doubled in the last four years and although the OFT’s crackdown has led to the police arresting 500 illegal lenders, once one loan shark is removed, another simply moves in and takes over.

“The UK economy is struggling and this Christmas is going to be financially harder for many more people than usual but our advice, like the OFT,  will always be the same – do not turn to a loan shark for help. It is not the answer,” adds John Fairhurst.

To view the OFT’s 60-second video depicting a loan shark experience, click here: http://www.youtube.com/watch?v=xlm58mFHjB0&feature=player_embedded#!

Anyone using a loan shark and wanting help with debt management and debt consolidation can speak to an impartial debt advice organisation such as Payplan, the National Debtline or Citizens’ Advice Bureau – all offer free support and advice and will not judge or comment on individual situations. Contact: Payplan - 0800 280 2816 or visit: http://www.payplan.com; Citizens Advice Bureau: http://www.citizensadvice.org.uk/getadvice.htm - to find your local CAB branch; or National Debtline: http://www.nationaldebtline.co.uk/ - 0808 808 4000.

Note to editors

Payplan was established in 1993 and is one of the UK’s leading providers of free debt solutions. Its award-winning service helps over 100,000 people in financial difficulties every year. In November 2010 it announced a working collaboration with the Consumer Financial Education Body (CFEB), the consumer arm of the Financial Services Authority.