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common complaints and case studies



I couldn't afford the loan ...

Sometimes people tell us that they shouldn’t have been lent the money at all - and that they could never afford the loan they’ve been given.

  • We’ll check that the payday lender has carried out sufficient checks before deciding to lend - which are proportionate to the size of the loan. We’d usually expect to see more thorough checks for a £900 loan compared with a £50 loan.
  • If we find the payday loan company didn’t carry out sufficient checks - and someone’s clearly having problems making repayments - we might decide the loan was unaffordable.
  • To put things right, we’ll usually tell the payday lender to write off interest and charges on the loan - meaning someone will only have to pay back the original amount they borrowed. Very rarely, we might tell the payday lender to write off all the debt - for example, if the lender knew someone was really struggling financially or had severe health problems when they took out the loan.
  • We’ll also check whether someone is complaining about more than one payday loan - either with the same lender or several different lenders. If they do, it could suggest they’re relying on short-term loans to meet daily costs - or to pay off other loans. So we’ll look closely at whether the payday loan company has ensured each loan is affordable - given their customer’s circumstances each time they applied.
  • Since January 2015, the most someone will ever have to pay back is twice the amount they originally borrowed - including fees and interest. So for loans taken out after 2 January 2015 we’ll check that someone hasn’t paid more than this limit.

case study 1

When Mr G’s moped broke down, he needed some extra cash to cover the repairs - and took out a payday loan of £300. When he couldn’t pay it back the following week, he took out another loan. Soon he owed more than £1,000 … >> read more

case study 2

When Mr W’s pay was cut, he took out a payday loan to cover some of his living expenses. But when the time came to pay it back, he realised he didn’t have the money. He told the payday lender - but they’d already added interest and charges, and told him he had to pay the loan back all at once … >> more



I've told the payday lender I'm struggling - but they're not treating me fairly ...

Under the rules that apply to lending, payday lenders need to treat customers fairly if they’re having financial difficulties. Some people tell us they feel they’ve been treated unfairly - for example, because their payday loan company won’t agree to lower repayments or is harassing them about their debt.

  • We know people can be worried and embarrassed about saying they’re having financial difficulties - and put off asking for help until they’re really struggling. We’ll look at when someone got in touch with the payday lender - and how quickly the lender responded. If the lender has caused unnecessary delays, we might tell them to refund any interest and charges that were run up as a result.
  • Even if someone hasn’t told their lender that they’re struggling, we’ll check whether there were signs that they were. For example, if someone has repeatedly missed payments or asked to roll their loan over, we’ll look into whether the lender questioned what was happening.
  • If someone’s circumstances have changed, this might mean their loan repayments have become more difficult to make than when they first took out the loan. But we often find that nothing’s changed in the short time since someone took out a loan. This can suggest the loan wasn’t affordable in the first place.
  • We’ll check what the lender did when they found out their customer was in financial difficulties. For example, did they reach a reasonable repayment plan - and have they carried on honouring it? If we decide the lender has acted unfairly, we’ll tell them to reach a fair agreement with their customer.
  • We’ll look at how the lender has tried to get the money back from their customer. It’s not unfair for a lender to contact someone about a debt. But harassing people at work or home - using threatening letters or phone calls - is never fair.
  • If someone’s been treated unfairly, we’ll always consider whether a payday lender needs to pay compensation for any trouble and upset caused by their actions.


I had a payday loan - and now I'm having trouble with my credit file ...

Some people tell us that having a payday loan has affected their credit file. They might only realise there’s a problem when they’ve been turned down for other borrowing, such as a credit card or a mortgage.

  • Some people tell us it’s unfair that a “default” notice has been put on their credit file - because they’ve settled their payday loan. But this isn’t necessarily unfair. Payday lenders are allowed to pass on information to credit reference agencies. And other businesses rely on the information as an accurate reflection of how someone’s managed their finances. So if someone hasn’t kept to their original agreement with a payday lender - for example, if they’ve agreed reduced payments - this will be shown on their credit file.
  • We won’t tell a lender to change someone’s credit file unless we decide information has been recorded unfairly or inaccurately. We often need to explain why a default has been recorded - because the payday lender hasn’t done this very clearly, if at all.
  • Payday lenders need to follow rules about recording defaults. We’ll check whether the lender notified their customer before they registered a default - so the customer had a fair chance to make a payment or reach another agreement. If we think a default has been unfairly recorded, we’ll usually tell the lender to arrange for their customer’s credit file to be corrected.
  • If the payday lender didn’t notify their customer - or the customer didn’t receive it for any reason - we consider what the customer would have done to stop the default if they had been notified. In some cases, the outcome would be the same - for example, if someone couldn’t afford to make a repayment, the default would have been registered whether they’d known about it or not.

case study 3

Ms O was paying back £10 a week to the payday lender’s collections agent. But when the collections agent only turned up now and then, Ms O fell behind with her payments - and the lender put a default on her credit file… >> read more



The payday lender keeps trying take money from my bank account - but I don't have the money to pay back the loan ...

Some people complain to us that a payday lender keeps trying to take money from their bank account - when they don’t have the money to pay back the loan. This might mean they’re left without money for other bills and basic living costs.

  • Payday lenders usually take regular payments using a “continuous payment authority” (sometimes shortened to “CPA”). We’ll check that the lender has followed the rules relating to CPAs. In particular, since July 2014, they can only try to take payment twice for each individual loan.
  • Sometimes people tell us that they’ve asked their bank to cancel a CPA - but their bank has told them they need to contact the payday lender. This isn’t the case - and if we see this has happened, we’ll clarify the situation as part of sorting things out.
  • Some people tell us the payday lender didn’t warn them that a repayment would be taken. While payday lenders usually send a reminder before a repayment is due, they don’t have to send one each time they try to use a CPA for the same repayment, if they try more than once.
  • If a payday lender hasn’t used a CPA fairly - and they’ve caused someone further financial difficulties - we’ll tell them to put things right. This may mean - if appropriate - freezing interest or charges on the loan, or refunding bank charges or extra expenses someone’s run up.

need help?

If you can’t find what you’re looking for here - or you’d like to talk to someone - give us a call ...

consumer helpline - 0800 023 4567
our technical advice desk (for businesses and consumer advisers) - 020 7964 1400

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