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Doorstep lending targeted by Trading Standards.
Loans provided by so called Doorstep Lenders are being targeted by an expansion of teams that have already existed in Birmingham and Glasgow since 2004.
These types of loans are typically for small amounts but are provided at inflated rates of interest, with repayments collected by callers to the borrowers home. The lenders of these types of loans use the collection visits to stay in close contact with the borrowers who often extend their loans in a vicious circle of lending which, due to the high interest rates charged, are hard to break out of.
Trading Standards say they have identified over 200 such lenders in the Birmingham and Glasgow initiatives and plan to expand their existing operating teams to a wider area in Soctland and also into East and South-East England.
The teams are worried about the illegal methods used in this type of lending, especially any intimidation and aggression used by the debt collectors. Worries are that vulnerable people are becoming trapped in financial situations they don't really understand or know how to remove themselves from.
Extra investment of £3 million will be added to the £50 million already spent, allowing new teams to be established in Yorkshire and Humberside, the North East, the East Midlands, the South West, Wales and the North West. They hope to bring many of these unscrupulous lenders to justice and prevent more people signing up for loans that are hugely overpriced or loans they can't afford to repay.
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