Midlands charity tackling loan sharks head on
A Midlands charity is rolling out a series of awareness sessions in its community aimed at tackling the rising issue of loan sharks in the region.
Citizens Advice Staffordshire North and Stoke-on-Trent (CASNS) is actively working with like-minded organisations to spread the message about dangerous loan shark activity and the steps that can be taken to prevent money issues from spiralling.
In the UK, anyone lending money to someone must be registered with the Financial Conduct Authority. If someone gives money as a cash loan and doesn’t provide legitimate paperwork, they’re an illegal money lender – or a loan shark.
It can lead to people paying large amounts of interest and paying back much more than the original sum.
According to latest statistics released from Creditspring in 2024, around six per cent of Brits may have turned to a loan shark in the previous 12 months – that’s close to three million people.
And the rising issue has led to CASNS working proactively to tackle the problem.
Paul Pritchard, Energy Team Service Manager at CASNS, said:
“We’re one of the largest Citizens Advice centres in the country and have our own debt department. When we identify issues in our financial capability assessments, we’re able to dig a bit deeper to see what the underlying issue is.
“We have a relatively disadvantaged community and as such, our residents are often quite susceptible to loan sharks.
“People generally come to us wanting energy vouchers or similar, but we can take the time to understand why they are needing the extra help and that’s when things can come to light. In this day and age, if we see cash withdrawals, it leads us to ask questions as to what that money might be being spent on.
“We’re not talking huge numbers; it’s certainly not an epidemic. But it’s definitely an issue.”
One client the team supported had borrowed £800 three years ago from a doorstep lender. They had been paying £120 a month back ever since – with payments totalling more than £3,500 until the CASNS team stepped in and made a referral to the Illegal Money Lending Team.
Paul added:
“Sometimes it’s impossible to calculate the interest. Loan sharks don’t go into detail about the repayments and end dates. There’s no credit agreement in place.
“These people are coming around knocking on the door and taking cash, which can obviously be quite intimidating.
“And people don’t often know who the debt is with, and how much they actually owe. And they don’t necessarily see them as loan sharks. That’s why education about it all is so important.
“We’re probably just scratching the surface. There’s a lot of shame and anxiety around it all. We can only support people who are stepping forward to tell us they have had issues. Part of our job is to make people aware we are here to help. If it means people think twice about using a loan shark, then we’ve done our job.”
Common warning signs someone could be a loan shark
- The person offering to lend money has no licence or registration to do so
- They are offering extremely high or unclear interest rates, making repayments unaffordable
- They don’t give you any documentation relating to the transaction
- They use intimidation, threats or violence to collect repayments
- They demand payment sooner than expected
- They take valuables away from you, such as passports or bank cards
Anyone worried about loan sharks can find out more from the Illegal Money Lending Team.
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