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Loan sharks benefit from UK recession

It is estimated that around 100,000 of the U.K.'s poorest families have been forced to go cap in hand to loan sharks to borrow a total of £29 million. These illegal lenders are then adding significant interest to the £29 million with some rates as high as 1500% a year. It is now believed that the initial £29 million borrowed by families in the UK has now ballooned to a debt of £82 million!

Even though the authorities have introduced a number of regulations and laws to safeguard those on low incomes against the threat of loan sharks, desperation has seen more and more people go down this very dangerous avenue. Threats and intimidation and worse have been reported to the police over the years but with many people desperate for money there is a fear factor about taking action against these illegal lenders.

Many people have seen small loans balloon into debts of thousands of pounds which they will be paying off for the rest of their lives. While desperate times require desperate measures there are other alternatives to loan sharks such as crisis loans and credit unions but the authorities need a program of re-education to make sure that everybody is aware of the alternatives.

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