According to a recent report from the Citizen’s Advice Bureau (CAB) around 76%
of people using payday loans could have cause to receive a refund or
compensation. Finding out if you are entitled to any form of recompense as a
payday loan customer could depend on several factors.

Recurring Payments: a third of complaints received by CAB were found to relate
to the way that payday loans are often set up with recurring payments.
Information about how to cancel such a payment should be provided up front as
well as a schedule for deducting payments. A reputable lender will offer these
details readily so you should be wary if this is not provided.

Fraudulent loans: with one in five people reporting that someone else has taken
out a payday loan in their name without their knowledge it is important to go
with a lender that makes thorough checks to confirm identity. If you find
yourself a victim of a fraudulent loan then contacting the lender should be the
first step. Giving them the details of the fraud should enable them to resolve
the problem for you. If that doesn’t happen the next course of action would be
to contact the Financial Ombudsman Service.

Harassment: This can difficult to prove as there is no real measure of
harassment in place. As a general rule lenders shouldn’t contact you at
unsociable hours and should be aware of any personal circumstances. Each
situation is different so some may find some actions more upsetting than others.
Unclear repayment amount: It is now imperative that when taking out a payday
loan you should be fully informed and aware of the repayment amount. The
repayment amount is likely to be considerably more than the amount borrowed but
a person needs to be notified formally of what it is to avoid repercussions at a
later date. This information should include dates when repayments will be made
along with how and they should be extremely clear and not lost in small print.

Affordability: Payday loans often get a bad press because it is thought they
take advantage of people who can’t pay. In fact lenders need to be confident
that the debt can be repaid at the outset otherwise they could be accused of
lending irresponsibly.

Repayment problems: If you are struggling to pay back a payday loan then you
should contact the lender directly with a repayment proposal. If this is
appropriate the lender may freeze interest and associated other charges. They
should also point you in the direction of companies offering free debt advice.