A debt advice charity is urging the trading watchdog to use new powers to stop four payday lenders in their tracks.
Citizens Advice said it has found evidence of lenders bombarding customers with emails and texts to pay back debts, taking money when the debt has been repaid and using aggressive and abusive staff.
The government is set to back calls to cap interest on payday loans
It found that firms are "exacerbating debt problems and causing significant distress", by using methods such as inflating their fees and charges and chasing people for debts on loans which they had never taken out.
The charity has handed over a dossier of evidence to the Office of Fair Trading (OFT), which is carrying out a probe into the payday lending industry.
Citizens Advice has not identified the payday firms involved but said that two are well-known names. It has also reported three debt collection companies, asking for their licences to also be suspended.
The charity said it has seen a tenfold increase in the share of clients needing help with debts which include a payday loan in the last four years. One in 10 clients with debt problems have payday loans, compared with one in 100 in 2009.
From Tuesday next week, the OFT will have beefed-up powers which will mean that it can immediately suspend firms' consumer credit licences.
At the moment, firms which have their licences suspended can continue to operate while they carry out lengthy appeals.
But the new powers mean that in the most serious cases the OFT can immediately put firms out of action when it believes that consumers are under threat of harm.
The watchdog has been carrying out a compliance review into the payday lending industry and last November it said that formal investigations had been launched into several firms over their debt collection methods.
The OFT said today that it expects to produce its full report on its review into the sector in the coming weeks.
A spokesman for the body said it will be considering the correspondence from Citizens Advice but said it was not appropriate to discuss its detail any further at present.
The spokesman said: "We would like to highlight that the new power to suspend can only be used in the most serious cases of immediate harm, but we won't hesitate to use it where cases fit that bill.
"In addition we expect to report within the next few weeks on our ongoing review into the payday sector."
The charity is gathering evidence about other lenders and is running a year-long study asking payday loan customers to share their experiences of using a payday lender.
Citizens Advice chief executive Gillian Guy said: "Our evidence shows these lenders are behaving as a law unto themselves.
"Excessive fees and charges are escalating debts and people are worried sick as companies bombard them with texts, emails and phone calls often overstating their debt collection powers.
"With a tenfold increase in people struggling with payday loans we are keeping a very close eye on the industry and will be reporting any other lenders to the OFT found to be using deceitful tactics."
Last autumn, the vast majority of payday lenders introduced improved codes, which mean that they should give clear information about how a loan works and freeze interest and charges if a customer is in financial difficulty.
However, consumer groups have argued that the new measures are largely a re-working of rules which have already been broken.
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