As the UK re-enters a recession, thousands of families are still feeling the pinch.
More people than ever are now using short term financial solutions to pay everyday costs, and it is estimated the industry will grow by another 40% in the next few years.
These ‘quick loans’ allow the user to take out a loan, usually within an hour, and can be an easy way to get their hands on some cash.
However the high interest rates and short term repayment windows can leave people with huge debts, which can be hard to clear.
Gavin Hayes, from the Campaign against Legal Loan Sharks said: “we think there are particular problems with the high cost credit sector.”
The Campaign is also calling for more regulation for the industry.
“A lot of these companies are exploiting consumers, and in response to this, we believe what is required is a cap on the total cost of credit.”
Despite the risks, Graham Wingate, who runs a business selling quick loans on behalf of other companies, said they are a useful financial solution but to remember
“They are only meant for short term financial solutions.”
LSJ News reporter Jonathan Brine took a closer look at the potential benefits and risks associated with using these services.