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FOS: Payday lending complaints set to rise

The Financial Ombudsman Service expects payday lending to become a bigger part of its workload after witnessing a surge in the number of complaints received over the past two years.

In the first half of 2011 the FOS received 125 complaints relating to payday loans, which increased by 36.8 per cent to 171 in the second half of 2011. In the six months to the end of September, the FOS has already received 271 complaints relating to this type of lending.

Payday lending complaints still account for a tiny amount of the FOS’ workload, accounting for only 0.16 per cent of the 160,987 complaints the FOS received in the first six months of 2012.

When asked, at a Treasury select committee evidence session last week, whether the complaints related to the lender conducting insufficient affordability checks, FOS deputy chief executive Tony Boorman said: “Obviously there is a responsibility on consumers but there are some responsibilities for responsible lending by these firms.

“It is a difficult area, quite a small area. I suspect it will be a growing area of our caseload over the coming year.”

Mortgage Concepts Associates director Mike Richards says: “I expect the number of complaints for these type of loans to rise because these lenders normally say you could have the money in an hour – that is not enough time to check a person can afford the loan.”

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Comments

There are 2 comments at the moment, we would love to hear your opinion too.

  1. and obviously it will be IFAs fault!

  2. A mortgate concepts director speaking about payday loans? how about talking about self certifying mortgages over the last 10 years.

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