WORKING families in York are turning to payday loan companies in increasing numbers just to put food on the table.
More and more people in the city who are seeking advice for debt management have payday loans, and research shows many of those are working people on low incomes struggling to afford the essentials.
The figures have come from partnership Advice York, who have published reports on the perils of payday loans, and on the fight to help people hurt by benefit reports.
The organisation - which includes York Citizens Advice Bureau, Age UK and York Foodbank - said that between the first quarters of 2011/12 and 2012/13 the number of people going to York CAB who had at least one payday loan soared from one to 24.
Advice York then surveyed its advice clients to find out how and why they used payday loans, and discovered that of the 50 people who replied, a third used payday loans, and of those, two thirds were in work. On top of that, as much 65 percent of payday loans went to pay for essentials like food, rent, and utility bills.
And even though they often do not offer the best deal, the most popular companies were those which either advertise widely on TV or have a visible presence on the high street.
Report author Sophie Tragheim said many people found themselves trapped in a cycle of debt after they turned to payday lenders thinking they had no other options.
One woman told Advice York that working in a zero hours contract in a low-paid cleaning job meant she soon got into debt simply trying to pay for essentials.
Even when working 55 hours a week, a large amount of her income went to pay back debts so she turned to payday loans to cover living costs - getting a £1000 loan despite her existing debts. Soon she defaulted on repayments and was hit by a hefty penalty, and ended up relying on food banks and the generosity of friends to survive.
Now the organisation wants to highlight that payday lenders and interest rates of 5000 percent are not the only options to getting credit, and raise awareness of the alternatives to counteract the glamour of TV advertising, such as Credit Unions or high street banks which Advice York's manager Susan Wood said may still offer better deals even to those with pre-existing debts.
She said: "We want people to shop around so if they have to go to a payday lenders they don't go to the most expensive one."
Gary Simpson, head of development at South Yorkshire Credit Union which covers York, said it was time to offer genuine competition to pay day lenders.
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