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All financial organisations that offer money lending services must adhere to a strict set of rules and regulations. These regulations are enforced by a government appointment financial governing body. The governing body is known as the OFT, and it works to ensure all lenders follow the statutory, and voluntary lending practices.

All lenders are required by law to operate in a fair and just manner, in order to protect the consumer. This involves fair lending practices, which includes clear information on interest rates and fees, full disclosure of the terms and conditions of a loan, and protection of a borrower's personal information. There are also a variety of regulations about advertising, and marketing financial services, fair and honest advertising, and practices for communicating with customers.

Unfortunately, not all lenders adhere to these regulations. The voluntary regulations are an area that is particularly abused by less than scrupulous lenders.

When you are considering a short term payday loan, you should be aware of some of the tactics that bad lenders employ and be aware of how to distinguish a good lender from the less than trust worthy companies.

Firstly, once you identify two or three possible lenders, you should look at their websites and make sure all the information about their loans is there; interest rates, fees and terms should all be clearly accessible, and written in clear understandable English. Next you should look for confirmation that they have the correct licenses to operate as a lender.

Once you have established these basic requirements, you can spend a little time looking for customer reviews and information about each company. If it is an unpopular company, or if borrowers have had problems with them in the past, you will soon come across articles online telling you about it.