Complaints Over Payday Loans Triple In A Year

New figures from the Financial Ombudsman reveal that disputes over payday loans increased by 178% in the year to March despite the fact that new controls and caps have been introduced in an attempt to regulate the system.

Rules introduced in January 2015 mean that interest rates on payday loads are capped at 0.8% per day, and the Financial Conduct Authority also ordered that stricter affordability checks be carried out before loans are agreed.

The statistics, which are released on an annual basis, show that in total more than a million people have made complaints about financial services during the past year, with issues ranging from the supply of pet insurance to problems with PPI refunds.

The Ombudsman dealt with 1.6 million enquiries of all kinds during the 12-month period - amounting to around 5,000 per day - with one in five resulting in a formal investigation.

Chief Ombudsman Caroline Wayman agreed the year had been a busy one, but said her emphasis was on the people behind the complaints rather than the numbers involved.

"We mustn't lose sight of the lives and livelihoods behind every complaint we resolve," she said.

"That’s why preventing mistakes of the past from happening again will help restore trust and fairness in financial services."

PPI remains a key issue for complainants with over half of the Ombudsman workload tied up with solving PPI disputes.

In total 188,712 new PPI cases were received, which equals around 4,000 complaints every week - however, this marks an 8% drop from the previous year.

Disputes involving credit, such as hire purchases or point of sale loans, was up by 40%, nit many of these were resolved within a day.

Overall, half of all complaints which were resolved found in the consumer’s favour.