New data from the Financial Ombudsman showed that most of the complaints for 2018 to 2019 related to affordability of such loans and many came through claims management companies.
Overall, complaints about financial services shot up to a five-year high, with more than 388,000 new complaints made in the last financial year, a 14 per cent increase on the previous year.
Caroline Wayman, chief ombudsman and chief executive of the Financial Ombudsman Service, said: "Too often we see that the interests of consumers are not hard-wired into financial services.
"This marks a five-year high in the number of complaints that consumers have brought to us, and the behaviour we've seen from some businesses is simply not good enough."
Short-term lender industry body the Consumer Finance Association (CFA) said most of the complaints were historic and came from a number of years ago, before changes in regulation.
A CFA spokeswoman said: "These figures show a deeply disappointing increase, driven by a flood from claims management companies and we continue to see many a complaint that has no foundation.
"Now nearly nine in 10 of complaints to firms are generated by these companies. The complaints are often of poor quality."
Mike Holmyard, financial spokesman for Citizens Advice Scotland said: “Some of the biggest issues with payday loans were stopped via the Financial Conduct Authority’s 2014 regulation and price cap, but today’s figures show that there are still major problems clearing up from previous excesses in the industry.
“The 130 per cent increase in guarantor lending complaints also confirms the experience of CAB advisers that this market is not operating fairly, and that perhaps tighter regulation is needed."
He added: “Bank complaints have also grown and it is clear from these figures that the credit market as a whole is not working for consumers. There is still an absence of affordable credit options, and too many people just don’t have enough income to live on."
Dr. Roger Gewolb, executive chairman of FairMoney, said: "Payday loan providers have their place in society for cash-strapped Brits, but most people have been abandoned by poor lending practices that stem from the financial crash of 2008. We’re a decade on and things need to have changed.
"Millions of people are being pushed into high-interest credit options which are not fair for the consumer, fair for the lender, or fair for society."
Gareth Shaw of consumer group Which? said: "Bank transfer fraud is spiralling out of control, with people losing life-changing sums every day and then facing a gruelling battle to get their money back from the very banks that should be preventing them from falling victim in the first place."