The need for quick cash is driving Australians into billions of dollars in debt.
Darren and Joanne of Brisbane spent months paying off thousands of dollars in payday loans taken out by their 25-year-old son.
“It just keeps going up more and more, and they keep running for more and more money,” they said. A case in progress.
Lenders are now trying new tactics to attract customers.
CashnGo kiosks have been set up in shopping malls in New South Wales.
Customers can get a loan of up to $ 2000 in a matter of hours, if they enter their details and are approved.
Talk to A topical matter, News Corp Personal Finance Editor Sophie Elsworth cautioned against the machines.
“It’s a real concern that you can go to a mall to do your shopping and while you’re there come away with a few thousand dollars in the form of a cash loan,” he said.
“It’s scary and the charges associated with it are very expensive.”
The government announced a review of payday loans and consumer goods leases in 2016. Since then, no changes have been made.
Ray Pilven, 51, has rented several items, including his television, cell phone and washing machine through a credit bureau.
He says he paid almost double for his goods and claims that “they rip us off a lot, and they know it”.
Fiona Guthrie of Financial Counseling Australia said: “It is truly disappointing that the government has been inactive in this regard, because it means that thousands and thousands of Australians have paid more than they should have. ”
She is now calling for stricter regulations for payday loans, consumer lease plans, and buy now and pay later programs.
“If it looks like credit, it smells like credit – it’s credit and should be regulated like credit,” she said.
Nearly 95,000 new “buy now pay later” accounts are opened each month across the country. A recent report from ASIC shows that one in six users has gone overdrawn, delayed paying other bills, or borrowed extra money.
Sophie Elsworth said consumers need to get back to basics of money.
“Consumers need to be a lot more patient and go back to the old-fashioned way of paying in cash, because as they say, money is king,” she said.
