Payday loans - The new rules explained

(9/02/2015) We explain the ins and outs of new Payday loan regulations

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Payday loans are a controversial and potentially very expensive form of borrowing, yet in times of heavy financial pressure - such as just after Christmas - many people with a poor credit rating may find it's the only option

But with new rules in force since 2nd January that put caps on interest and other charges, borrowers should find payday loans a potentially cheaper option.


Payday lenders, like the rest of the insurance industry are regulated by the Financial Conduct Authority, an independent body that is paid for by charging fees to the members of the industry

The new rules

1) Since 2nd January, lenders have been limited to a cost cap of 0.8% of the total amount borrowed per day. This includes both interest and any other fees.

2) Lenders are also banned from requiring borrowers pay back more than 100% of the amount borrowed - this is intended to stop debts spiralling out of control.

3) A new fixed fees cap means those struggling to repay on time will never face a default charge in excess of £15

Who do I complain to?

If you've taken out a loan and you feel its terms do not adhere to the new FCA rules, then you should raise the issue with the lender via

If the payday loan company fails to resolve your complaint, you can take it to the Financial Ombudsman service eight weeks after first raising the issue

Got a complain to make about your payday loan? raise it via resolver now

Or if you want to find out more about Payday loans and your rights, you can do so here

Who do you have an issue with?

Raise it for free via Resolver

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With Resolver you can send your case to key ombudsmen and regulators including:

Furniture ombudsman Ombudsman services Financial ombudsman service C e d r Gambling commission Consumer dispute resolution ltd logo Transport focus logo

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We will never share your personal data with anyone without your permission - your case will go to the firm you’re complaining about and, if appropriate, to an ombudsman.

If you find something wrong with a company or our processes, tell us and we will put it right.

You can raise a complaint against Resolver via Resolver itself.

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