OFT Warns Payday Loans To Straighten Out

The video discusses the growing reliance on payday loans despite high interest rates and public aversion. The Office of Fair Trading is investigating lenders for oppressive practices, such as failing to ensure loans are affordable and rolling over loans. The consequences of payday loans include a debt spiral for borrowers. The industry, represented by companies like wonga.com, claims to act responsibly and supports investigations into unscrupulous lenders. Future regulations and standards are anticipated to protect consumers better.

What is the main reason families are turning to payday loans despite their high interest rates?

• To pay off long-term debts

• To save for future expenses

• To make ends meet in the short term

• To invest in new business ventures

What is one of the main issues the Office of Fair Trading is investigating about payday lenders?

• Their advertising strategies

• Their loan approval speed

• Their customer service practices

• Their oppressive debt collection methods

What problem do borrowers face when they cannot repay payday loans on time?

• They are offered a new loan with better terms

• They receive a discount on the loan

• They are automatically forgiven the debt

• They fall into a cycle of taking out more loans

Which company is mentioned as a leading payday lender that supports the investigation into unscrupulous lenders?

• QuickCash

• Wonga.com

• LoanExpress

• FastFunds

What is the payday loan industry doing to differentiate responsible lenders from less responsible ones?

• Increasing loan amounts

• Engaging in self-regulation

• Reducing loan approval times

• Offering lower interest rates