Pay Day Loan, what can the police do?

Last year when I was really struggling to pay my outgoings and my car had problems I had to take out Pay Day loan from a local shop. I payed it off and took 2 more loans out paying both of them off too. I then took a final loan of �300, at the same time I had to move because I couldn't afford where I was living. I pretty much forgot about the loan and subsequently failed to pay it back. I haven't heard anything since but today had a visit from 2 POLICE officers! Claiming an allegation had been made regarding the loan. I have to go to the police station in a weeks time to be interviewed under caution. Is this normal for a loan? I have never heard of the police being called regarding an unpaid loan. I'm concerned also that the Loan shop may have contacts within the police. Does any one have any suggestions regarding this situation. I am now debt free bar this loan and could clear the loan if absolutely necessary, but am unsure if doing this would affect the case in any way.