ONE of the only growth industries since the financial crash and the coalition's subsequent failure to get the economy back on track, has been companies offering payday loans, a quick fix to ease the pressure on family budgets.
These companies, perfectly legally in Scotland, can offer small attractive loans but with interest rates of up 2000% forcing families in need of a quick fix, further into debt.
Research published by Shelter confirms just how popular pay day loans have become.
To pay for mortgage or rent costs, 15% of respondents to their survey - nearly seven million people across the UK – said they rely upon one or more forms of credit.
And a recent review by the Office of Fair Trading laid bare the extent to which the payday lending industry is failing to work in the interests of its customers.
The UK's overall industry regulator found too many people are being issued loans they cannot afford and that the industry is disproportionately profiting from customers who extend or "roll-over loans", effectively borrowing new debt to pay for old debt.
The OFT was so concerned by what it found that it referred the payday lending industry to the Competition Commission for further investigation.
And the problem is significant in our city; a recent study by Glasgow City Council suggests around 100,000 Glaswegians regularly use non-standard forms of credit totalling £57m a year.
That is why the Labour Party is calling on the Scottish and UK Governments to give more support to Credit unions as a community based, not-for-profit alternative to payday loans, offering small scale loans at competitive rates.
These local institutions provide a vital and often unseen service in our communities helping people who are often ignored by the traditional banking sector to get everything from a bank account to a mortgage.
Credit unions offer a more sustainable solution to short-term debt problems than these legal payday loan sharks. And, with families across our city and the wider country facing tightening budgets, Government must ensure Scottish people know this support is available.
I was delighted to see Glasgow City Council will now give every one of the nearly 6000 new secondary school children £10 in a community credit union account to ensure every young person in the city has access to a responsible option for savings and money advice.
This is a fantastic example of what a local authority can pro-actively do to stop the payday loan industry gripping a new generation of consumers and protecting young Glaswegians.
Both Government should take the lead of the city council and give local authorities the power, under planning legislation, to stop payday lenders taking over our high streets and shopping arcades.
