Don’t be bitten by a loan shark this Christmas

Christmas is meant to be the most wonderful time of year, but for many families trapped in spiralling debt and living in fear of loan sharks, that simply isn’t the case.

The England Illegal Money Lending Team (IMLT) has launched a campaign #AllIWantForChristmas to encourage families to avoid using loan sharks over the festive period and for anyone who has been affected, to report the crime.

If you’re struggling with the cost of Christmas it might seem tempting to borrow money from a loan shark. But loan sharks are illegal and although they may seem friendly at first, any money you borrow will come at a high price. Not only will you pay far more in interest than you would through any legal borrowing, but loan sharks often use intimidation and threats if you get behind with your repayments.

Often people are even pressured into borrowing more money to repay one loan with another and end up in a spiral of debt that can never be repaid. Illegal money lending also has a detrimental effect on families and can cause serious physical, emotional and psychological damage to victims.

How to spot the signs of a loan shark

If you can answer yes to one or more of these questions you might be borrowing from a loan shark:

• Did they offer you a cash loan?
• Did they not give you paperwork?
• Did they add huge amounts of interest or APR to your loan?
• Have they threatened you?
• Are you scared of people finding out?
• Have they taken your bank card, benefit card, passport, watch or other valuables from you?

If you’re in doubt about borrowing money from someone, first check to see if the lender is authorised by the Financial Conduct Authority (FCA).

If you’ve already borrowed from a loan shark, the important thing to remember is you haven't broken the law and there is help available. Visit the Stop Loan Sharks website or call 0300 555 2222 anytime day or night to report a loan shark (you can do this anonymously).

For top tips to help you afford the cost of Christmas check out our article in this month’s issue for a budget-saving festive season.