Some borrowers of payday loans are having their accounts drained of funds because of automatic withdrawals by lenders, a charity has said. Some lenders use continuous payment authorities (CPAs) - recurring payments from accounts - to make sure repayments are made. But Citizens Advice said that 90% of these customers may have grounds for complaint about unfair treatment. It analysed 665 cases of borrowers who approached the charity for help.

Rule change
CPAs are commonly used by gyms and magazines to take renewed subscription payments automatically. They are also used by payday lenders to collect repayments directly from someone's bank account. CPAs should not be used to take money without warning, but a lender has some flexibility over when and how much money they can take from a borrower's account. However, since 2009, banks and building societies have been obliged to cancel CPAs when asked to do so by their customers.....Read more here