By Marcus Leach

Continued economic difficulties seem to be taking their toll on the nation, as the number of people running into debt through so-called payday loans has quadrupled in two years.

This is according to the Citizens Advice Bureau, who claim payday loans (small, short-term unsecured loans), are too easy to obtain. They are calling for tighter regulations.

Ed Davey, consumer minister, believes a change in regulations would have a negative effect, forcing more people to go to loan sharks.

The attractiveness of such short-term loans is that they are easy to get, and if paid back quickly they can often prove cheaper than credit card charges, overdraft charges.

However, there are worrying negatives to such a loan, with some charging interest rates of more than 4,000%. If these are not paid back quickly debts can quickly escalate.

"The sort of regulatory regime isn't working to protect people, so there's work for the government to do," Peter Tutton, from the Citizens Advice Bureau.

"The government needs to look at consumer credit and get really serious about making it more effective.

"We need better sorts of messages to firms that it's not acceptable to treat people badly," he said.

The government have said they are conducting their own research, although as of yet they are not sure the answer is a cap on payday loan interest rates.

"In the last government - the Labour government looked at capping interest rate costs of credit three times," Mr Davey said.

"And the last Labour government rejected it three times because they were concerned that they would push vulnerable consumers into the hands of these illegal money lenders who are really the nasty of the nasty."

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