North Lanarkshire is payday loans capital

It was once the steel centre of Scotland, earning the town the nickname “Steelopolis”.

But Motherwell now has a far less desirable title as the country’s payday loan capital.

Motherwell’s ML postcode – which includes other North Lanarkshire towns Airdrie, Coatbridge, Hamilton and Wishaw – has the biggest payday loans per head of population in Scotland, according to research.

A figure of £23.87 was borrowed for every resident in the Motherwell postcode area in 2018, followed by Stirling at £21.53 per head and Glasgow at £19.97.

Nearly 37,000 high-cost, short-term loans were taken out in Motherwell and £9.1million borrowed.

Despite a cap in 2015 on how much lenders can charge, borrowers still paid an astonishing £5.9m in interest and fees.

Politicians blamed the borrowing on benefit cuts, low wages and zero-hours contracts.

Marion Fellows, SNP MP for Motherwell and Wishaw MP, said: “The roll-out of Universal Credit, which cuts incomes, rigged disability assessments, a minimum wage below the real living wage, precarious work through zero-hours contracts, and the two-child tax credit cap are all policies which are forcing people to turn to payday loans.”

North Lanarkshire Council, meanwhile, suggested alternatives to payday loans, saying: “We would recommend using credit unions rather than payday lenders or other short-term, high interest loans.”

But some Motherwell residents said payday loans are a lifeline.

Teresa McConnell, 49, of Motherwell, said: “I’ve used payday loans in the past and would use them again, I think they are pretty handy.

“I’ve got money from them when it’s been the run-up to Christmas, and other events, and usually borrow about £100 a time.

“I’ve always managed to pay the money back so haven’t got into any problems.”

The data was obtained from the Financial Conduct Authority by Wagestream, an app firm that enables workers to receive a percentage of their wages as they are earned.

Wagestream founder Peter Briffett said: “Financial stress caused by the monthly pay cycle means people turn to payday lenders not out of choice but necessity, so it’s vital we replace this industry with something better.”