After more than 10 years of campaigning, we were delighted by the announcement this morning that the government is to cap the cost of borrowing from payday lenders.
We underestimate how much the money-lending business has taken over. A few years ago in Parliament, when I tried to get a new consumer credit act to include capping interest rates, the main lender was the Provident – who built up resistance on the grounds that they really helped ordinary people, particularly in poorer northern communities. Even the national Citizens’ Advice Bureaux opposed interest rate capping on the grounds that it would drive legitimate lenders like Provident out, and people would turn to unlicensed lenders. It was agreed at the time to boost funds for local debt advice workers instead.