The payday loan industry has come under heavy criticism in recent years and has been linked to other financial hardships, stress and anxiety, and even health problems. Now, recently published research has shown that they are the “sickest” financial product on the market. The survey was conducted by the Royal Society for Public Health (RSPH) and the End High Cost Credit Alliance, which examined the impact of different types of debt on people’s lives and well-being.
In the report, it was revealed that payday loans have the greatest overall impact on the mental well-being of borrowers compared to other credit products in the market. Participants were asked a number of questions about their financial situation, as if they were able to maintain their repayments and were still in debt. They were also asked how the loans affected their mental health, including whether they felt depressed, anxious, guilty, ashamed or angry.
They were then given a score out of five – a lower score indicating that it had a greater negative impact on their well-being. Payday loans got the lowest score at 1.88. This was followed by unauthorized overdrafts and home loans. The report also found that three in five people who owed payday loan companies money were consuming alcohol to deal with their mental health issues, caused by debt.
Michael Sheen, who participated in the research, said: “As a society we believe in justice and compassion and yet debt problems are pushing more and more people into poverty, putting their lives at risk. physical and mental health. It’s not acceptable. This report shows how damaging it is to have an economy, culture and infrastructure that allows donors to put profit before our health and well-being.
He added, “We share a moral responsibility to help protect vulnerable customers from the damage caused by high cost credit. The evidence for the impact on our health and well-being is now overwhelming. We have the evidence. Now we need action.