Payday lenders face debt probe
Several payday lenders are facing formal investigations over the use of "aggressive debt collection" methods, the trading watchdog has announced.
The Office of Fair Trading (OFT), which is carrying out a compliance review into the industry, is also writing to all 240 lenders in the market to outline its concerns about poor practices in the sector.
It said it expects to warn the majority of 50 firms it has inspected, which account for the lion's share of payday loans, that they risk enforcement action if they do not improve their standards.
The OFT has not named any particular firms involved at this stage or said how many are being formally investigated, but it will publish a full report in the new year setting out whether wider action is needed to tackle the problems.