The FCA proposals won't help people like Daneka - a single mum with three kids. To help pay the bills, she took out loans from multiple payday lenders, but quickly got into a spiral of debt. When she couldn’t pay back the loans, the lenders encouraged her to 'roll over' the loans, but charged her extra every time. Then without telling her they repeatedly raided her bank account, so she couldn’t pay the bills or her rent, and the debts piled up.
Daneka would not be protected by the FCA’s proposed regulation. Multiple lenders could still give her loans which they know that she can’t afford. Lenders could still hit her with excessive charges and raid her bank account without telling her. The proposals don’t tackle these issues and won’t be enforced until October 2014. This isn’t good enough, and we need to change their mind.
This is why we have got together with a cross-party group of MPs and some of Britain’s biggest debt, consumer and anti-poverty organisations – including Which?, Citizens Advice and Stepchange - to launch a Charter to Stop the Payday Loan Rip-off.
Ask your MP to Back the CHARTER TO STOP THE PAYDAY LOAN RIP-OFF
This week CAP published a detailed report, Stopping the Payday Loan Rip-off, which provides background on the payday lending industry and our Charter. If you want to know more, you can click here to read the report here.