After recent research by R3 revealed that more than five million Brits have admitted that they will be taking out a payday loan in the next six months to try and make ends meet, Stella Creasy has spoken out about the lack of regulation in the industry.
She told Radio 4?s Today Programme: ?The time for self regulation in this industry is more than over. The government really needs to get a grip and back all the measures about capping the cost of credit before this debt tsunami engulfs whole sections of Britain.?
?People are borrowing in this very toxic way because of the high interest rates and the ways in which these products are marketed. They are getting themselves into further levels of debt.?
?A lot of people get caught thinking that they can pay it back at the end of the month and then obviously they find that the charges escalate and they haven?t got enough money, because they haven?t got enough money to pay for the goods in the first place.?
?So then they find the following month, that even if they manage to pay off the first loan, they are out of pocket earlier in the month so they need to borrow again. That?s why it gets so toxic because it is a spiral that people get drawn into.?
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