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Payday loans 'an expensive way of managing your own money'

Citizens Advice Scotland have urged Scots to avoid payday loans, as there are other ways to maximise their income.

A survey by R3 today shows nearly half the population turning to pay-day loans. In response, CAS Head of Policy Susan McPhee says,

“This report shows what we in the CAB service see every day. Huge numbers of people are really struggling just to make ends meet because, in the words of one CAB client recently, there is ‘too much month left at the end of the money!’

“For these families, pay-day loans can seem like the only option to pay the bills and put food on the table as the month wears on. But no matter how attractive these loans might seem at the time, you have to look at the small print and see how much you’ll have to re-pay.

“The truth is that pay-day loans are usually a very expensive way of managing your own money. They will usually make your financial situation even worse for you in the long run, and really should be avoided - particularly as there are other options available to you.

“For example, you may be entitled to benefits or tax credits that you are not aware of. This might seem unlikely, but in fact CAB advisers regularly find cases of people who are missing out on some sort of benefit or grant - just because they weren’t aware of it.

“If you go to your local CAB they will do such a benefit check for you, and will also give you advice on other ways to maximise your income without turning to high-cost lenders. If you have already fallen victim to a pay-day loan or any other type of debt and are struggling to pay it back, we can help you with that as well. And our advice is always free, confidential and impartial.

“But the best advice on pay-day loans is to give them a miss altogether. They are likely only to make your situation worse, and there are other much better ways of getting through the month.”

For more information, interviews etc., please contact Tony Hutson on 0131 550 1010.