Council makes stand against payday loans

WARRINGTON Borough Council has banned access to payday loan websites and highlighted a series of cautionary tales revealed by residents who had fallen foul of the companies.
From this week, people can no longer use computers on council premises, for instance in libraries, to sign-up for high-interest loans which council chiefs believe can seduce people into debt and sometimes into serious financial difficulties.
Council leader Cllr Terry O’Neill said: “We hope that if people hear about the difficulties that some of their neighbours have got into at the hands of payday loan companies, it might prompt caution.
“Some of the accounts given to the council by our partner organisations in Warrington make very sad reading. We would encourage anyone considering a payday loan to beware the pitfalls of these loans at outrageously high rates of interest.”
One Warrington borrower found the payday lender was dipping into her bank account on a regular basis to grab money as it arrived in her account. She only became aware of this when she tried to withdraw cash from her account, and discovered it was no longer there.
Another local borrower had two payday loans which each started out at £100 – but she found herself trapped into an unbreakable borrowing cycle and ended up owing £1200, and felt that insolvency was the only way out.
One local man living on benefits had six separate payday loans, indicating that the lenders had done no credit checks before lending to him.
Cllr O’Neill continued: “We would encourage people who are feeling the pinch to look into alternatives including credit unions. There are several in Warrington and they exist purely to help local people.
“The council offers free money advice online and people can get free advice from charities such as the Citizens Advice Bureau and StepChange or the National Debtline.”