NHS staff, council officials and gig economy workers are among the most regular applicants for payday loans, which charge interest of up to 1,325% per year, industry data has revealed.
In Birmingham, Leeds and Manchester, city council workers were among the most frequent applicants for the ultra-high interest debt last month, according to figures from a loan comparison website.
In Leicester, workers for the courier company DPD applied for the most loans after people in the NHS. The most common reason given for requesting the loans was “to pay bills”.
Around 300,000 people a month take out the high-cost short-term credit. At the end of 2016, 1.6 million people had payday loan debt, with the average loan just over £300. Around one in eight of the debtors was in arrears, according to the Financial Conduct Authority.
After NHS staff, supermarket workers for Tesco, Asda and Sainsbury’s applied for the most loans in March, followed by staff at McDonalds, the supermarket Morrisons and Royal Mail. Next came the British Army – which has already banned payday loan adverts from military bases and publications – Amazon and workers for the outsourcing giant Capita.
NHS workers’ representatives said it showed “a terrible state of affairs”.
“No one should be so desperate for money that they have no option but to go cap in hand to unscrupulous lenders,” said Unison head of health, Sara Gorton. “It shows how much harm years of government pay restraint has caused.”
Sarah-Jayne Clifton, director of the Jubilee Debt Campaign, said the figures showed how “austerity, low wages, and insecure work are driving people to take on high cost debt from rip-off lenders just to put food on the table”