Pay day loans summit shambles

The Government are being criticised today for holding a summit on pay day loans that has been branded a sham as before negotiations even began. Minister in charge Jo Swinson MP has ruled out one possible solution of capping  lending costs before the summit even begins.

The industry – which is worth over £2 billion – has more than doubled over the last four years. Some loan companies are charging interest rates of over 5,800%.

Labour Treasury spokesman Chris Leslie MP is quoted in the Mirror as saying:

“Urgent action is needed to grip the regulation of the payday loan industry, as the number of cases of misery and hardship are growing rapidly because of pressures on living standards and personal finance.

“The Government have consistently ducked clamping down on predatory pricing and extortionate interest charges – despite Labour securing an amendment in the House of Lords last year which gives regulators the ability to control costs and loan duration.”

Labour’s Stella Creasy MP – who has been instrumental in raising the profile of the issue of pay day lenders – has not been invited to attend the summit said:

“Having a summit on payday lending without talking about a cap is the same as holding summit on arson and not mentioning matches”.