One debt collection agency has recently announced it will no longer be collecting on debts owed to providers of short term loans in the UK, citing concerns regarding the regulatory scrutiny and volume of complaints that the instant cash loans industry is drawing.
Debt collectors Fredrickson International, a subsidiary of Interlaken Group, stated that its existing customers with paying accounts will continue to be serviced. However, it has shuttered to any new business from payday advance lending providers due to the ‘grave concerns’ it has about the current state of the market.
The new announcement will have ramifications for all of Fredrickson International business groups. This means that competitor firms which act as debt collection agencies for payday lenders will soon be under increasing pressure from the decision, as Fredrickson’s Credit Account Management division currently oversees several debt collection agency panels.
Interlaken Group’s sales and marketing director, Jan Michael-Lacey, stated that the firm will no longer have a hand in the payday lending sector due to reservations in regards to the direction being taken by the market in general. The sector is currently under scrutiny from the Office of Fair Trading, added the sales director, who commented that Interlaken had ‘grave concerns’ over the number of complaints the industry has generated as of late.
Mr Lacey furthermore said that Interlaken Group would adopt a wait-and-see approach in regards to taking on additional payday lending clients in the future, indicating that no decision would be made until announcements were made about the regulation of the lending sector.