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Illegal Lenders

Illegal lenders, or loan sharks, are a growing problem in the UK, and many people are suffering in silence after borrowing from these exploitative criminals.

illegal lenders loan shark

How to spot an illegal lender:

Any loan should come with a written credit agreement. All legal lenders have a Consumer Credit License number which can be checked with the Financial Conduct Authority. Any loan or lender without these is illegal.

Other signs that can point to an illegal lender is a very high interest rate, pressure to borrow more and more money, delivering cash only loans to a borrower’s house, and threatening or harassing borrowers who fall behind on their payments. Some legal lenders also use these tactics, including many payday or doorstep lenders, which can be confusing.

When choosing whether to borrow money from one of these companies, always check the Consumer Credit License number of your lender and think about how the terms of the loan will affect your life (for example, the total cost of a loan with a very high interest rate, or the impact of losing your car if you can’t pay back a logbook loan).

What to do if you’ve borrowed money from an illegal lender:

If you are being threatened by any lender, illegal or legitimate, call the police immediately.

By law, you do not need to pay back any money borrowed from an illegal lender. However, to avoid inflaming the situation, many people recommend paying back the amount borrowed with a reasonable amount of interest, and telling the lender that you have taken legal advice.

You can help stop illegal lenders and loan sharks from harassing you by reporting them. You can report a loan shark anonymously at or by calling 0300 555 2222 (in England). These teams are trained to protect people and communities being harassed by loan sharks.

The best way to avoid being targeted by illegal lenders is to stay away from emergency borrowing:

If you are borrowing from short-term or illegal lenders, it is often a sign that you have run into problems with other debts. If your debts are becoming unmanageable or you are struggling to make payments, please call a member of our advice team on 0800 088 2599 or 01282 218218. There are ways out of debt and we can help.