Debt-ridden social workers turning to payday loans

Growing numbers of social workers are falling into financial difficulty, with some resorting to high-interest payday loans, according to a support charity.

The Social Workers Benevolent Trust, established and supported by the British Association of Social Workers (BASW), saw a 61% increase in social workers approaching it for help last year. A further significant rise is expected this year.

The trust believes the economic downturn, a reduction in staffing levels and a growing number of agency staff struggling to find enough work have all contributed to increasing levels of financial hardship.

The trust received 97 applications for assistance and made 63 grants in 2010-11, compared to 63 applications and 43 grants the previous financial year. The trust has already received 100 applications in 2011-12.

The trust’s chair Simon Cole said the use of payday loans was a relatively new phenomenon. “Some of these companies have an APR of 4,214%. These loans, often relatively small, when not repaid on the due date, can grow very quickly and often cause people’s overall situation to worsen. It is a cause for concern that social workers feel pressured to turn to the same loan providers they might caution their clients against using,” he added.

In response to the trend, BASW has launched a debt advice service which members can contact on 0800 652 1640.

(Pic: Image Source/Rex Features)