Lenders are targeting hard-up households with “Christmas loans”, charging interest of up to 648 per cent.
Firms are pushing pricey deals as people’s expenses mount up ahead of the big day in December, with some promising to have cash in borrowers’ accounts in minutes.
Loans At Home promises to deliver cash advances of up to £600 “directly to you”, but with interest of 433.4 per cent APR.
My Quick Loan offers “Christmas loans” of between £100 and £5000, boasting: “You could have cash in your account in just 10 minutes.” It quotes a loan with a 648.6 per cent representative APR.
Zipcash.co.uk offers loans of £100 to £3500 “in only 10 minutes”, with interest of 97 per cent.
The promotion of Christmas loans prompted Labour MP Stella Creasy to demand caps on all forms of credit to protect borrowers.
Creasy, who launched a campaign against high cost credit firms, said: “These firms think Christmas has come early when they can rope cash-strapped customers into loans.
“We urgently need to expand access to affordable credit so that people don’t get stuck borrowing from these predators at sky-high rates.”
Marc Gander, of the Consumer Action Group, said: “Christmas is a time when poorer families become easy pickings for lending sharks.
“Taking out one of these loans may buy the kids a memorable Christmas but they’ll pay for it financially for months or years.”
It comes as Britain’s largest payday loan provider, QuickQuid, is set to close.
Its US-owner Enova says it is leaving the UK market “due to regulatory uncertainty”.
QuickQuid’s customers were warned not to stop making repayments.
Doing so might mean their credit ratings are hit and they could face extra fees and charges, according to Caroline Siarkiewicz, acting chief executive at the Money and Pensions Service.
Payday lenders are under strain due to a surge in claims for compensation lodged by customers who believe they were mis-sold loans they could not afford.
Similar issues triggered the collapse of former industry leader Wonga in 2018 and The Money Shop in June.
The Financial Ombudsman Service said 59 per cent of complaints made to it about CashEuroNet UK, which trades as QuickQuid, between January and June were upheld.
All the firms were contacted for comment.
