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Payday lenders crackdown call

Moneys

Predatory payday loans are on the rise as Tasmanians feel the pinch from the rising cost of living.

Advocacy groups including the Hobart Community Legal Centre and TasCOSS have released data revealing more and more people are being trapped in debt.

They're calling for a crackdown on lenders offering triple-digit interest rates.

The number of women using payday loans increased by 23.13% as a proportion of total loans between 2016 and 2019, with 41% of those women single mothers.

There's been a 15.5 per cent rise in high-interest payday loans in Tasmania between January and July this year.

No Interest Loans (NILS) Tasmania CEO John Hooper says they're taking too many calls from people who've been sucked in. 

“Last month for example, we saw a contract where a GeorgeTown resident was paying $5460 over three years in a consumer lease for a fridge that retails for just $1797. That’s an annual interest rate of 100%! These are debt traps pure
and simple," he said. 

Consumer Action CEO and Alliance spokesperson, Gerard Brody, is joining other advocates to call for a Morrison Government crackdown on predatory lending. 

“The harm caused by payday loans is very real, and this newest data shows that more Australian households risk falling into a debt spiral,” he said.

“Meanwhile, predatory payday lenders are profiting from vulnerable Australians to the tune of an estimated $550 million in net profit over the past three years alone.”