Families may struggle with monthly payments

Many families will struggle with their finances as a result of changing Universal Credit to monthly payments, those seeking payday loans have been advised.

Family Action chief executive Helen Dent said that the announcement by the Department of Work and Pensions will be bad news for many families who rely on weekly payments.

She said that the idea was clearly conceived by those with enough money to have bank accounts offering the best savings rates, direct debits and standing orders.

"However the problem is that for a large number of people on benefits or a very low income and with growing debts, bank accounts and stable finances are a distant dream," Ms Dent said.

She added that the company is worried the change may force vulnerable families to seek the help of disreputable lenders.

Consumer Credit Counselling Service also recently revealed that young people are entering adulthood with debts from credit cards, overdrafts and payday loans.

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2011-09-13 14:21:08 © Moneyextra.com