WIGAN teens are borrowing money as “unscrupulous lenders” prey on vulnerable targets.
Shocking figures from Action for Children show that one in five children and young people aged 12 to 18 are getting payday loans.
This is more than the national picture of one in eight, which shows overall, out of the 1,058 12 to 18-year-olds surveyed, 41 per cent have borrowed with pay day loan providers, using cash to replace household goods, set up their first home or keep up with their friends.
The charity believes the crisis will be made worse by a lack of financial knowledge amongst young people across the UK.
A spokesman said: “We were shocked to see some respondents as young as 12 had taken out payday loans. “It could be they are carers for their parents and are in charge of finances, or they are basically using fake details and being targeted by unscrupulous lenders.”
This news is worrying for the borough’s MPs. Wigan MP Lisa Nandy said; “This shocking report shows that too many young people in the North West are making bad financial choices at an early age, which can affect them for the rest of their lives. The coalition increased the level of debts young people can expect if they go to university. This generation of young people are paying the price for this shocking failure. Earlier this year thousands of people in Wigan signed our petition calling for tougher laws to stop loan sharks who blight our high streets from charging excessive rates of interest.”
Makerfield MP Yvonne Fovargue said: “This report demonstrates the need for financial education being an important element of the school curriculum but we also need to see action against the constant and remorseless advertising pressure, normalising high cost short term loans and irresponsible lending by some companies.”
Meanwhile, Wigan Council has issued a warning against using payday lenders, and instead use the Credit Union, as over the last five months, figures show that the borough owes £166,109,207 in personal loans, which equates to an average household debt of £1,230.43.
During the same period 1,416 visits were made to Wigan Council’s crisis desk because residents didn’t have any money, another 1,583 because they had no food and 263 because they didn’t have gas and electric.
For information about support available visit www.wigan.gov.uk/moneyadvice. To report a loan shark call 0300 555 2222 or text LOAN SHARK and the lender’s details to 60003.