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Christmas pay day loans to increase in London

It is estimated nearly half a million Londoners will take out pay day loans this Christmas to cover the cost of the festive period.

These short-term loans can have interest rates as high as 4,000%.

The government is planning to cap the amount lenders can charge but the loan companies say there is a demand for this style of short-term lending.

BBC London's Noel Titheradge meets Elisabeth Matthews who owes £2,000 after taking out four pay day loans while unemployed.

  • 12 Dec 2012
  • From the section London