'Toxic' loans industry scrutinised at summit
Sunday 30 June 2013
Payday lenders, regulators, charities and government ministers will be brought together on Monday to tackle the problems in the loan industry.
Jo Swinson, the minister responsible for consumer affairs, will host the summit, which comes just days after the sector was referred for an investigation.
The Office of Fair Trading (OFT) referred the £2bn industry to the Competition Commission last Thursday, saying it fears that consumers who cannot afford to pay their loans back on time are finding themselves trapped with one firm when their loans are rolled over.
It is also worried that payday loan firms are emphasising the speed of the loan over cost and that lenders may be “skimping” on affordability checks.
Up to half of lenders’ revenues were found by the OFT to come from the extra charges and interest coming from loans being rolled over. The Commission’s investigation will take up to 18 months and it has powers to ban or limit products.
The payday sector has come under heavy criticism from debt charities, which have accused lenders of being “out of control”.
Ahead of the summit, Richard Lloyd, executive director of Which?, said the consumer group wanted to see more action from Government to tackle the “toxic market”. He said: “We want new rules banning excessive charges, a restriction on the number of times a payday loan can roll over and clearer advertising.”
Payday lenders argue that they have worked to clean up their act, including the introduction of a new code of practice last year to ensure loans are affordable.
- 1 Unseen Charlie and the Chocolate Factory chapter deemed 'too subversive' released
- 3 Joan Rivers: 'Palestinians deserve to be dead'
- 4 A teacher speaks out: 'I'm effectively being forced out of a career that I wanted to love'
- 5 Mexican woman becomes world’s 'oldest person' at 127
Israel-Gaza crisis: YouTube footage shows scale of destruction after 50 days of shelling
Keira Knightley topless: Conservative actress does own take on #Freethenipple campaign for Interview Magazine
iPhone 6 'hidden code' could indicate sharper screens or bigger phones
Joan Rivers: 'Palestinians deserve to be dead'
Ebola virus: It's ripped through towns – now the deadliest ever outbreak of the virus is heading for Africa's teeming cities
Robin Williams Emmys tribute led by Billy Crystal criticised for including 'racist' joke about Muslim woman
Rotherham child sex abuse scandal: Labour Home Office to be probed over what Tony Blair's government knew - and when
The Rotherham child abuse scandal is a tale of apologists, misogyny and double standards
What do immigrants really think of Britain? Polish immigrant's Reddit post goes viral
Do you realise just how foolish the UK looks?
With Douglas Carswell joining Ukip, my party has taken another giant step forward
- < Previous
- Next >
£85 - £110 per day: Randstad Education Cheshire: randstad education require a ...
Negotiable: Randstad Education Hull: Randstad Education are recruiting for spe...
Negotiable: Randstad Education Plymouth: Randstad Education Ltd are seeking EY...
Negotiable: Randstad Education Plymouth: NEWLY QUALIFIED TEACHER WE CAN HELP ...