By Daniel Hunter
Citizens Advice is warning payday lenders that they must face up to problems in the industry or expect continuing scrutiny and tough new rules.
Speaking after today's summit to look at problems with the industry, Citizens Advice Chief Executive Gillian Guy said:
"It is good that extra attention has been given to the problems in the payday loans industry today but I was disappointed that payday lenders are still determined to play down problems. It's impossible to deny that people have been seriously affected by the irresponsible practices of this industry.
"The fact that people are coming to Citizens Advice for help because they have been given loans they can't afford to repay and are hounded by texts and phone calls as lenders try to claw back debts shows this is a problem which urgently needs to be tackled.
"Lord Freud was right to raise concerns about the impact that the use of Continuous Payment Authorities could have on Universal Credit. We are already seeing people plunged into serious financial trouble because their bank balance is drained without any warning and it will only get worse as people adapt to a new benefit system.
"The Financial Conduct Authority will have strong, new powers to tackle wrongdoing by payday lenders, and I am particularly keen to see new action on advertising. Payday lenders need to be clear about who they are targeting. We see daytime television adverts with glamorous celebrity endorsements targeted at the unemployed and those on low incomes."