03.10.2013
The Financial Conduct Authority today launched new rules to curb the practices of payday lenders.
The FCA announced limits on the number of times lenders can roll-over loans and a limit on the number of times lenders can use continuous payment authorities to go into borrower’s accounts. Lenders will also face harsh fines and closure if their advertising or marketing material is misleading.
Ben Hughes, Chief Executive of the CDFA, welcomed the new restrictions but commented that more action is needed:
“The government and regulators need to go much further if we’re going to address the appalling practices of payday lenders that prey on the poor. They need to provide proper backing for the ethical alternatives that already exist.”
“David Cameron wants to be the world leader in social investment. Now we need him to provide a social investment fund that will enable ethical lenders – like community development finance institutions – to dominate our high streets and provide cheap, fair credit to those who need it.”
“We need to invest in our communities, rather than suck the wealth out of them.”