Payday Loans

Lord Bishop of Gloucester Excerpts

Tuesday 10th January 2012 Lords Chamber

[Baroness Wilcox]

My noble and learned friend is exactly right, and that is what came out of the consumer credit review. We are working with the industry and consumer groups to ensure that that is the information that people get immediately when they need it.

[The Lord Bishop of Gloucester]

My Lords, the Church of England’s national investing bodies recently decided to avoid investment in payday lending firms because of the risk of exploitative lending. Bearing in mind that credit has to be provided responsibly and affordably, will the Government also consider instituting a requirement that payday lenders must, before advancing a loan, assess a borrower’s financial circumstances and ability to repay?

[Baroness Wilcox]

The firms are strongly controlled by the Office of Fair Trading as to how they get their licences. They should already be asking for and giving out such information. If evidence is brought that that is not happening, the OFT is very quick to come down on it, and the Trading Standards Institute is of course involved. At the end of the day, people who desperately need money will hardly hear what someone is saying to them about how much a loan is costing and how much they will have to pay back. Right now, right there and right then, they need a washing machine.