Loan Shark Debt Campaign Update

Loan shark debt dangers highlighted in ongoing campaign

The Office of Fair Trading (OFT) has joined the ‘Stop Loan Sharks‘ campaign aimed at warning people about the risks of using loan sharks to try to solve their debt problems.

Loan sharks are actually illegal money lenders and prey on those vulnerable people struggling with debt. Unlicensed loan sharks will often offer cash loans without paperwork, charge extortionate interest rates and may use benefit payments or bank cards as security or threaten the use of violence if loan payments are missed.

According to the (OFT) there are an estimated 165,000 households in the UK that have loan shark debts, with half of these in the most deprived areas of the country.

In accordance with the campaign now fronted by the OFT and Trading Standards Illegal Money Lending Teams, loan sharks can now be reported by either calling 0300 555 2222, by sending a text with the words ‘loan shark’ and the details to 60003 or by sending an email to reportaloanshark@stoploansharks.gov.uk.

Jacqui Kennedy, Director of Regulatory Services at Birmingham City Council said:

‘It’s great to have the support of this campaign in our continued fight against loan sharks. It’s vital that we get our message out to vulnerable people that loan sharks are never a good option. It may seem like easy cash at first but very quickly people can become trapped in a spiral of debt’.

Nationally, the ‘Stop Loan Sharks‘ project has so far helped more than 11,500 people, written off more than £31 million of illegal debt, secured more than 60 years in prison sentences including an indefinite sentence for public protection, and seized £1million in cash.

For more information about how to report a loan shark watch the ‘Stop Loan Sharks’ campaign film on YouTube.

IMPORTANT NOTICE
If you’re receiving violent threats made by loan sharks because of missed payments, you should contact the Police immediately. If you’re struggling to manage your debts, contact Payplan today for free, confidential debt advice.

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Slow Economic Recovery Into 2011

CBI warns of sluggish economy until mid 2011

Confederation of British Industry (CBI) predicts annual UK GDP growth of 1.0% in 2010, followed by 2.5% in 2011.

A recent press release from business group the CBI claims the economy is expected to grow by 0.3% in the first two quarters of 2010 and by a slightly faster 0.5% in the next two quarters.

Inflation is also expected to be slightly higher than previously forecast in the near-term, but is then expected to fall back considerably as Consumer Price Index (CPI) inflation drops below the Bank of England’s 2% target by the end of 2010. This is set to remain below target throughout 2011.

GDP in 2011

The CBI predict the Gross Domestic Product (GDP), the measure of the country’s overall output, is not expected to have returned to pre-recession levels by the end of 2011.

Richard Lambert, CBI Director-General, warned:

“The CBI expects the recovery in 2010 to be slow and sluggish, with few signs of real strength until well into next year.”

Payplan

If you are struggling to cope with debt during this tough economic climate, contact Payplan today for free, confidential advice or call 0800 280 2816

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Joint Commitment to Credit Card Customers

New Consumer Credit Card Protection Agreed

The UK Cards Association and the Department for Business, Innovation and Skills (BIS) have reached a joint commitment as a result of the recent consultation regarding the ‘Review of the Regulation of Credit and Store Cards’.

Credit card companies have agreed their commitment to support customers’ interests by making sure that customers are able to control and manage their finances.

New Terms

Part of the agreement lead to the proposal that monthly repayments should at least cover interest, fees and charges, plus 1% of the amount spent.

Additionally, the previous decision to raise the minimum payment required each month has been abandoned.

The changes are set to come into force by the end of January 2011 and also include:

  • Ensuring the highest cost debt on a credit card is paid off first.
  • A ban on those in financial difficulties being offered an unsolicited rise in their credit limit.
  • Any customer offered a credit limit increase will be offered a new 30-day notice period for ‘opting-out’.
  • A 60-day period for people to reject a change to the interest rate on their existing debt. If they reject it they must close their account.
  • Card companies will contact any customer who repeatedly only makes the minimum repayment to make clear that this is the most expensive way of paying off a debt.
  • Card companies will work with debt advice agencies to agree how they might further identify consumers at risk of financial difficulties.

Payplan

If you are struggling with credit card debts or are finding it hard to meet your monthly repayments, contact Payplan today for free, confidential debt advice or call 0800 280 2816.

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Consumer Debt Averages £132 for Energy Bills

Energy Consumer Debt Hits £132

Energy consumers in debt to their suppliers now owe on average £132 - 5% more than last year, according to a study conducted by uSwitch.

Research shows that, of those in debt, 41% now owe more than they did this time last year while 17% said they owed less.

However, the poll for comparison website uSwitch found the number of UK households owing money has dropped from 6.5 million last year to 5.5 million - or 21%.

The figures follow recent gas price-cuts across the industry due to falling wholesale prices.

USwitch reported household energy bills rocketed by 42% (£381) in 2008 but fell by just 4% (£54) in 2009. Price cuts so far this year average out at 4% (estimated £45).

According to uSwitch, it is predicted that the average household bill will be £1,209 a year once the cuts come into effect - this is still £297 or 33% higher than at the beginning of 2008.

Payplan

If you owe money towards your monthly utility bills and are worried about debt, contact Payplan today for free, confidential advice.

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