"The number of people taking one out has quadrupled since 1996 according to the watchdog Consumer Focus. That is despite some companies charging interest rates of more than 2,500% a year. The organisation is now calling on the industry to bring in more safeguards to protect vulnerable borrowers. ''Payday loans are a valid form of credit and it's much better for people to take one out rather than go to a loan shark," said Sarah Brooks, head of financial services at Consumer Focus. But we do think there needs to be a limit on the number of loans people take out and how many loans they are able to roll over." Research by Consumer Focus suggests that 1.2 million people are now taking out a payday loan every year, borrowing a total of £1.2bn." (BBC News, 14 August) RD
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