Local Labour MP, Tom Blenkinsop, has today (9th August 2013) pledged his support for the month long campaign by Citizens Advice to “not to let predatory lenders get away with treating them unfairly” and to “fight back” if they’ve been mistreated by a lender, by making a free complaint to the financial ombudsman.
The charity says customers should take their complaints to the free Financial Ombudsman Service. Citizens Advice analysed 665 payday loan cases reported to it in the first six months of this year and found that in 76% of them, borrowers had grounds to go to the ombudsman.
The Ombudsman Service, which resolves disputes between consumers and financial bodies when a complaint has been unsuccessfully resolved by the firm involved, can order firms to put the situation right if it agrees with the customer’s complaint. This means a borrower could get a refund or compensation.
“Official forecasts show that working people will have lost an average of £6,660 after five years of the Tories so turning to payday loan companies may well become the only option for people struggling with the unprecedented squeeze on living standards.
“This is an extremely important campaign that Citizens Advice has organised. Whilst ideally you would do everything possible to avoid using payday loan companies that charge extortionate interest rates, for many people they have no choice and this is their last resort. It is important that people have as much knowledge as possible when entering into such arrangements and it is vital that they are aware of what is and is not acceptable for payday loan companies to do.
“Moreover, I will continue to campaign for and promote the use of more ethical ways to get a loan. But more importantly the Government has several ways it can tackle the squeeze on living standards by implementing a lower 10p starting rate of tax; or through better regulating payday loan companies by capping the cost of credit.”