Desperate families in England are turning to illegal loan sharks to cover funeral expenses, as new data reveals a sharp rise in such borrowing amid financial pressures. Campaign organizations warn that thousands seek these predatory loans weekly during times of grief.
Scale of the Debt Problem
Recent analysis from the Centre for Social Justice indicates that up to 1.08 million individuals in England owe money to illegal lenders. Among them, approximately 32,400 have taken out loans specifically for funeral and health-related costs. This number surges to 43,200, or 4% of total borrowers, in the first half of 2025 alone, underscoring the growing urgency of the issue.
New Campaign Offers Support
To address this crisis, FuneralExperts.com and Stop Loan Sharks have launched a campaign providing free guidance and resources for those navigating bereavement without viable financial options. Key assistance includes the Funeral Expenses Payment administered by the Department for Work and Pensions (DWP). Eligibility applies to individuals receiving benefits such as Universal Credit.
Qualifying circumstances include being the partner of the deceased, the parent of a baby stillborn after 24 weeks of pregnancy, or the responsible adult for a child under 16—or under 20 if in approved education or training. Additional support comes from local charitable grants and community services.
Challenges for Borrowers
Research from Stop Loan Sharks shows that 91% of those borrowing from illegal sources lack any savings, while the remaining 9% hold only minimal amounts. Half of these borrowers forgo essentials like food or heating to meet repayment demands, exacerbating their vulnerability.
FuneralExperts.com analysis further reveals that many families overpay significantly, with some facing bills up to £1,550 higher than the most affordable options available.
Expert Insights on the Crisis
Joanne Regan, Director of Operations at FuneralExperts.com, emphasizes the emotional and financial toll: “Every day we hear from people who feel trapped, facing funeral costs they cannot afford, with nowhere to turn. In that moment of grief, many are pushed towards illegal loan sharks or overcharged by providers who should know better.”
She highlights comprehensive support: “At Funeral Experts, we sit alongside families, not only helping them find the right funeral director but also guiding them through benefits, council tax changes, grant applications, and even practical tasks like notifying organizations. This kind of support can make the difference between spiralling into debt and finding a way forward. Bereavement is hard enough without the added fear of financial hardship. Our message to families is clear: you are not alone, and there is free, compassionate help out there.”
Dave Benbow, head of the England Illegal Money Lending Team (IMLT), which operates as Stop Loan Sharks, addresses the predatory nature of these loans: “Funerals can be costly, and when someone passes away suddenly or unexpectedly, it’s often an expense that hasn’t been planned for. This can leave families needing to find money quickly, at a time when they are grieving and emotionally overwhelmed. That’s the last thing they should have to deal with.”
He warns against exploitation: “Unfortunately, illegal lenders often take advantage of people when they are at their most vulnerable. Situations like this can be seen as an opportunity for them to exploit those in distress. There is help available to cover funeral costs, but in the midst of such a painful time, families may struggle to manage both their grief and their finances. We strongly urge people not to borrow from illegal lenders, even if they seem like a friend offering a favour.”
Individuals in debt to loan sharks can seek confidential help by contacting Stop Loan Sharks at 0300 555 2222.
