With the Christmas season pretty much upon us many consumers will be gearing up to start shopping for their Christmas purchases, which could include gifts, clothes, extra food, tickets for travelling to see friend and relations, and more. However, many people will not have the available funds saved up in the current financial climate and will therefore be relying on credit in order to get them through.

Credit cards, of course, are used heavily over the festive season by those that need to buy their purchases using credit and this can lead to a worrying amount of debt, with many experiencing bill shock in January after getting carried away with their credit card spending. However, for those who do not have a credit card or cannot get further credit card finance there is another type of debt that is causing concern, which is payday loans.

Whilst payday loans can provide a financial lifeline for those who have a financial emergency and need to bridge the gap until they get paid, using these loans to pay for purchases and luxuries over the Christmas period can lead to spiralling debt, particularly for those that find they have to rollover the debt because they cannot afford to repay it in January.

One official said: “Many people might thing that a payday loan is the easy solution to getting finance to make purchases for Christmas, partly due to the ease of getting this finance and the speed at which it can be obtained. However, for those who are unable to repay the debt in full when they get paid in January the interest can be crippling and it could lead to spiralling debt, which is not the ideal way to kick off the New Year.”

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