A third of our clients have had nuisance calls offering them payday loans. That’s the shocking finding from our latest research into the scale of nuisance calls to those in debt. (Source: Nuisance calls survey with StepChange Debt Charity clients, 2014)
Tempting offers of easy-to-apply-for payday loans can be a real source of stress for many people, and today we’re asking for unsolicited calls and texts offering high-cost credit to be banned.
Last October saw the launch of our Got Their Number campaign, which focused on the harm caused by unsolicited marketing calls and texts.
Our initial research found that people struggling with debt were particularly vulnerable when it came to the marketing of high-cost credit, often being offered products that worsened their financial position. Recently we followed this up this to understand better how unsolicited marketing of high-cost credit harms those in debt.
We carried out a poll with 1,000 people who contacted our helpline and found that shockingly a third of our clients have had nuisance calls offering high-cost payday loans. On average these clients say they receive a whopping 10 calls per week, however some receive many more.
Unfortunately we found this marketing can have a terrible impact on people’s lives: 15% of those who had been called ended up applying for the credit offered. The additional debt they ended up with averaged £980. We’ve little doubt that this added debt burden only made things tougher to deal with.
Nuisance contact continues to a problem, and we want it to stop.
How does nuisance contact affect our clients?
We were curious to know what goes through a person’s mind when they receive these messages: are they really as dangerous as we think?
After reading the following quotes from two of our clients, we’ll let you decide:
“When you’re as desperate as I was, it’s strangely comforting to know that there was money available no questions asked. The reality of course is that you’re digging yourself deeper and deeper into a hole, and these companies know that.”
“It started off slowly at maybe three or four calls a day but by the end of the week we’re talking 40, 50 calls a day…even text messages, it was constant…I say ‘I don’t want any more debt’ and they’ll still try and they’ll ring up and offer me all sorts. No matter how many times I say ‘no I’m not interested’ they’ll just keep on ringing.”
So now that we know how serious the problem is, what’s being done about it?
New payday lending regulations
On 1 July 2014, a number of new rules on payday lending from the Financial Conduct Authority (FCA) came into force. The FCA has taken great strides to make consumer credit practices fairer and safer for thousands of people. That said, the promotion of high-cost credit such as payday loans via unsolicited marketing is still very much in force.
We’re urging the FCA to take a closer look at the problem of unsolicited marketing of credit. We also believe that an outright ban on this kind of contact is the way forward.
What you can do to help?
If you’ve had to deal with unsolicited and unwanted contact from telemarketers, tweet us about it with the hashtag #GotTheirNumber.
A screengrab of the text message would really help us build a body of evidence of just how out of hand unsolicited contact has become. (Find out how to take a screen capture on a mobile phone)
You can also email us with your thoughts and screengrabs at firstname.lastname@example.org. Together we can try to stop unsolicited high-cost credit being offered to those with debt problems.
(Quotes taken from Nuisance calls survey, 2014)