Local people are becoming trapped in spiralling debt with payday loan companies ‘helping themselves’ to Midlothian bank accounts.
With families struggling to make ends meet, some are turning to payday loans.
However, with some having an interest rate of up to 4,000 per cent, what seems like a ‘godsend’ can become a nightmare, with debt problems easily spiralling out of control.
Jimmy Campbell, of Dalkeith Citizen’s Advice Bureau, revealed that local people have come to him after money lenders continued to take money from their accounts.
He said: “Problems arise when the loan is due for repayment as the money is deducted directly from the borrower’s account, normally by a process known as recurring card payment.
“In the event that there are insufficient funds to meet the contractual repayment, the lender will then withdraw the money available, add further charges and reapply on random dates for further payments.
“It is at this stage that things spiral out of control as further interest and charges accrue on a daily basis and the lender has almost unlimited access to the borrower’s account.”
Read more on this in the June 20 edition of the Midlothian Advertiser.