WELSH government minister for tackling poverty Huw Lewis has hit out at payday loan firms, saying more and more people are turning to them to make ends meet.
Mr Lewis has called on British regulators to take action against such companies, which offer borrowers cash quickly but often at a high rate of interest.
He said many payday lenders do not comply with compliance requirements such as assessing the affordability of a loan for an applicant.
“This squeezes more responsible lenders out of the market and allows unscrupulous ones to take advantage of people who are often in dire financial situations,” he said.
“Payday loan companies are popping up all over the country with a barrage of advertising on TV, online and in our newspapers.
“As the full impact of the UK government’s welfare reforms start to kick in I am very concerned that more and more people will be tempted by these loans to make ends meet.”
Mr Lewis has given evidence to a consultation by the Office of Fair Trading, which is looking at referring the payday loan market to the Competition Commission.
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