Some banks have been told not to lend money to anyone claiming Universal Credit, an SNP MP has claimed.
Philippa Whitford added that claimants looking for loans could be driven "into the hands of payday lenders and loan sharks" if they cannot get the funds from other sources.
She made the comments as she outlined draft legislation that would overhaul the Universal Credit system.
"Some banks have been advised by their risk departments not to lend against Universal Credit at all," Ms Whitford (pictured) told MPs.
"Many working people will now be receiving tax credits through Universal Credit, and this income may not be counted towards getting a mortgage.
"Those who are looking for loans may also be refused and this could drive them into the hands of payday lenders and loan sharks."
The Central Ayrshire MP was introducing her Universal Credit (Application, Advice and Assistance) Bill via a 10-minute rule motion.
She said the maximum waiting time to receive Universal Credit should be a month, and the rollout should be paused if the Department for Work and Pensions could not deliver this.
Ms Whitford added that claimants should automatically have 12 months to pay back any advance payments they receive before they get their first claim.
"This Bill would propose that the Government follows the options that will be available from the Scottish government, in the form of twice monthly and direct landlord payments," she said.
"Claimants shouldn't have to jump through hoops for these. They should simply be options to be chosen."
She also called for separate payments to individuals rather than to one person per household, citing fears over domestic abuse and financial control.
"It's quite Victorian to go back to the idea of the breadwinner," she said.
"No woman should have to choose between poverty and abuse."
Ms Whitford went on to say: "I call on the minister to listen to the charities, to local authorities and to MPs right across this House.
"It's important that they recognise Universal Credit is flawed. They need to fix it now."
She was given permission to bring in the Bill and asked for it to be given a second reading on March 16.
It is unlikely to become law in its current form without Government support or sufficient parliamentary time.
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