PAYDAY lenders are to be watched "like a hawk" by Citizens Advice Scotland.

The booming industry – which has grown fivefold since 2008 despite concern over interest rates of up to 4000% – today launches its own code of conduct.

Citizens Advice Scotland immediately introduced a campaign to make sure firms live up to the voluntary charter, which comes amid a threat of spot inspections by the Office of Fair Trading.

Chief Executive Margaret Lynch said: "The way payday and short-term lenders currently operate is very poorly regulated, and as a result we see huge numbers of people getting into unmanageable debt."