Research conducted by Vincent Bond and Co suggests 28% of people who are struggling to make ends meet have taken out a payday loan to help with their finances.
Payday loans in the UK are rapidly increasing with four times as many people using these loans in 2009 compared to 2006.
In 2009 1.2m people took out loans with total lending spiralling to £1.2bn while 3.5m people are expected to take a payday loan in the next six months of 2012.
Steve Rees, managing director of Vincent Bond & Co, said: “Since the start of the 2009 recession there has been a boom in the payday loan market.
“For some debtors, the only answer they can think of is resorting to a payday loan.
The firm revealed that unemployment was one of the major causes of financial problems with one customer stating: “Due to the recession I was made redundant and had to relocate to find work.
“I found a job but with less pay my debt started to build up from trying to cover the costs of living.”
Our advice is simple. When you take out a payday loan, ensure you pay it back upon your next payday.
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