A PAYDAY loan borker that profits from charging customers interest rates up of up to 1,575 per cent wants to send people to PRISON if they can’t afford to pay their debts.
Quick Loans described hard-up Brits struggling with repayments as “bad people” and compares defaulting on payments to shoplifting.
In a vile blog post, the payday lender called for the return of horrendous debtors prisons, which were abolished in 1869 due to their inhumane, workhouse conditions.
It is illegal in the UK to be imprisoned for debt on overdrafts, loans, credit cards or energy bills.
Although, it is possible for people to end up behind bars if they fail to pay criminal fines, council tax bills or child maintenance fees.
The loans company has blasted customers for borrowing cash “without a concrete plan to repay [it] on time” despite lending to those with bad credit.
The firm wrote: “Think of how satisfying it would be as your neighbour who is always living beyond his or her means, the one who has been living the high life driving round in flash cars – we all know them – is carted off to prison for a couple of months because he doesn’t make the repayments.”
Payday lenders prey on those who are in desperate and in need of quick cash which is why they continue shockingly high interest rates, as The Sun has highlighted in a our campaign against high cost credit – Stop The Credit Rip Off.
Customers who borrow from the firm face forking out extortionate amounts to cover repaying the loan plus interest.
For example, if you borrowed £100 for the firm at a rate of 1,575 per cent, after one month you will owe the company £231.
Debt charities have slammed the firm as “irresponsible” and “incredibly ill-judged and deliberately provocative”.
Jane Tully, from the Money Advice Trust, said: “Worryingly, the article plays up to certain misconceptions about problem debt and the lives of people in financial difficulty that do not reflect the challenging and complex situations people face.”
How to claim a refund from payday lenders
YOU can claim compensation from a payday lender if the loan was unaffordable, even if you’ve finished paying it off.
If you think you are owed compensation, then then you should follow these steps from DebtCamel on how to claim.
1. Check if you were mis-sold the loan
Before a lender gives you a loan, they have to check whether you are able to pay it back.
For a payday loan to be affordable, you had to be able to pay it back the following month as well as pay your other bills and debts.
The loan was unaffordable if:
- you often rolled loans or borrowed again soon after repaying a loan;
- your loans from a lender were increasing in size;
- some repayments were late; or
- the loan was a significant part of your income.
Ask the lender for a copy of your loan details, like when you took it out and how much interest you paid.
Compare it to your bank statements from the time you took it out and work out if you would have been able to pay back the loan after you paid your bills.
2. Make a complaint
DebtHacker.co.uk is a completely free tool that will help you with the same process.
If you’d prefer to do it yourself then you should write a letter or email citing citing “unaffordable loans” and ask for a full refund of the interest and charges you paid, plus the 8 per cent Ombudsman interest on top.
Also ask for the loan to be removed from your credit record.
3. Go to the Ombudsman
If you haven’t heard anything back from them after eight weeks then you should take the issue to the Financial Ombudsman.
You should also contact them if your complaint is rejected, the refund is too low or they refuse to consider loans that are over six years old and have been sold to a debt collector.
Campaigner Sara Williams, who writes the Debt Camel blog, said: “Bringing back debtor’s prisons is the most stupid suggestion I have heard for years.
It would hit people whose circumstances had changed through no fault of their own – perhaps they had been made redundant or someone in their family has health problems. And it would cost taxpayers a fortune.”
Customers in substantial debt can now ask for the interest to be removed from their loan or to have the amount refunded by submitting a letter of complaint to the lender.
Richard Lane from debt charity StepChange branded the suggestion of heavy-handed enforcement as “simply cruel”.
“Rather than “living beyond their means”, most people in debt have ended up there because of a shock to their income,” he told The Sun.
“Most scrimp and save and worry and juggle to try to meet their commitments.”
The charity suggested that the best solution for people is debt is to enter a plan to repay their debts on a manageable basis.
He added: “There’s no excuse for peddling such negative and inaccurate stereotypes about debt when the reality is generally so very different.”
A spokesperson for Quick Loans told The Sun: “Quick Loans was trying to highlight a position that exists where APR’s could be significantly reduced for everyone if adequate deterrents were in place to stop reckless borrowing.”
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We previously reported how a dad-of-two got a refund for more than £3,750 from a payday lender for a loan he could not afford.
Last year it was revealed that workers are turning to payday loans to make ends meet and pay off unexpected bills.
We pay for your stories! Do you have a story for The Sun Online Money team? Email us at [email protected]or call 0207 78 24516. Don’t forget to join the Sun Money’s Facebook group for the latest bargains and money-saving advice.
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