November 2014: Regulators take action to tackle payday lenders following church campaigning

caplogo.gifNews release
17 November 2014  
For immediate publication

Regulators take action to tackle payday lenders following church campaigning

Following years of campaigning by Church Action on Poverty, regulators have take action to limit the extortionate charges of high-cost lenders which trap thousands of people in poverty.

The Financial Conduct Authority (FCA) announced last week that a cap will be placed on payday lending from January 2015. It means that for new payday loans, including if they are rolled over, interest and fees must not exceed 0.8% per day of the amount borrowed. Fixed default fees cannot exceed £15 and the overall cost of a payday loan will never exceed 100% of the amount borrowed.

Church Action on Poverty has been calling for a cap of this kind for many years. Most recently, it was one of the key demands in the Charter to Stop the Payday Loan Rip-off, which we published in autumn 2014 alongside MPs and other charities. Church Action on Poverty published a report alongside the Charter, which revealed the excessive profits being made by payday lenders at the expense of their vulnerable customers. (See www.church-poverty.org.uk/drowningindebt)

Church Action on Poverty's Communications Manager Liam Purcell commented: "We are delighted to finally see action being take to regulate these legal loan sharks.  The cap will make life easier for thousands of the poorest and most vulnerable people in the UK. It shows that when churches and Christians speak out prophetically against injuustcie, they really can achieve change."

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ENDS

Additional Information

  • Church Action on Poverty is an independent ecumenical charity, founded in 1982 and dedicated to tackling the root causes of poverty in the UK. www.church-poverty.org.uk
  • Church Action on Poverty has been campaigning for affordable credit since 1999, when we launched the Debt On Our Doorstep coalition.
  • The Charter to Stop the Payday Loan Rip-Off was developed in partnership with Paul Blomfield MP, other MPs, the Centre for Responsible Credit, and StepChange. www.church-poverty.org.uk/drowningindebt
  • See the full announcement from the FCA at www.fca.org.uk/news/fca-proposes-price-cap-for-payday-lenders

For further information, to obtain images or to arrange an interview please contact:

Liam Purcell, Church Action on Poverty
Tel 0161 236 9321
Mobile 07728 290 777
Email liamp@church-poverty.org.uk

Church Action On Poverty, Unit 28 Sandpiper Court, Water’s Edge Business Park, Modwen Road, Salford M5 3EZ

Telephone 0161 872 9294 or email info@church-poverty.org.uk

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