Cheap credit websites slammed by Financial Ombudsman
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Your support makes all the difference.Websites that take hundreds of pounds from unwitting consumers on the promise of finding cheap credit, only for the loans never to materialise, have been slammed by the Financial Ombudsman.
Since the start of the year thousands of people, many struggling financially, have contacted the ombudsman complaining that payday loan middlemen had drained money from their accounts, without providing them with the loan they were looking for.
In some of the worst cases, consumers’ bank accounts were debited multiple times without warning – as their banking details were passed onto other credit broking websites.
The ombudsman said that so far this year more than 10,000 people have complained about credit broking websites, more than double the number in the whole of 2013.
In the majority of cases, the business running the websites refunded the cash they had taken as soon as the ombudsman got involved. In two-thirds of complaints investigated, the ombudsman agreed that the consumer had been treated unfairly, while in the remainder of cases the fees had already been refunded.
The ombudsman also highlighted that many people who had used these websites thought they were applying for a loan directly and didn’t realise that they were paying a middleman.
Senior ombudsman Juliana Francis said: “It’s disappointing that people who are struggling to make ends meet are being misled into thinking that these websites will get them a loan.”
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