MPs held a debate in the House of Commons on January 20 2014 regarding the activities of payday lenders. During the debate, many MPs highlighted their own experiences of payday lenders, and those of their constituents.
Shadow Treasury Minister Cathy Jamieson MP highlighted several Labour Party policies that the Government has so far failed to implement. These include: bringing forward the cap on the cost of credit (which may not be implemented until 2015), forcing lenders to implement real-time data sharing, banning loan advertising on children’s television and imposing a windfall tax on lenders’ profits. “It’s clear from their speeches that some members of the government have come round to our way thinking and are now prepared to back some of the actions we’ve been calling for. Too many people have suffered at the hands of payday lenders and many more will continue to unless we act,” said Ms Jamieson.
Charlie Elphicke, the Conservative MP for Dover & Deal, called for a cap on the amount that can be borrowed, as well as on the cost of borrowing. He also remarked on the level of charges imposed on borrowers who default on their loans. “If we want Britain to be a land of opportunity for all, we also need to protect the most vulnerable in society,” he said.
Naomi Long of the Alliance Party, who is the MP for East Belfast, spoke of her own experiences of being pursued by a payday lender for a loan she had not taken out. Her initial letter to the company querying this was not replied to. It eventually transpired that fraudsters had taken out a loan in her name. Ms Long said of this occurrence that “it simply raises more questions as to how [fusion_builder_container hundred_percent=”yes” overflow=”visible”][fusion_builder_row][fusion_builder_column type=”1_1″ background_position=”left top” background_color=”” border_size=”” border_color=”” border_style=”solid” spacing=”yes” background_image=”” background_repeat=”no-repeat” padding=”” margin_top=”0px” margin_bottom=”0px” class=”” id=”” animation_type=”” animation_speed=”0.3″ animation_direction=”left” hide_on_mobile=”no” center_content=”no” min_height=”none”][payday lenders] handle personal data.” She also told the debate: “Regulation of the sector is key to prevent people taking multiple loans, to check affordability before lending, to introduce caps on total cost of loans and on default charges, to deal with aggressive marketing in the sector and the management of people’s personal information.”
Roberta Blackman-Woods, the Labour MP for City of Durham, describes lenders as “pay day loan sharks” in the line above a transcript of her speech on her personal website. In her speech, she raised four key issues: the interest rates charged, which she said “should not be tolerated in our society”; the debt cycle which many borrowers became trapped in; the high number of payday loan shops on our high streets and the targeting of disadvantaged customers.
The Labour MP for East Lothian, Fiona O’Donnell, said one payday lender in her constituency had been marketing its services by handing out balloons to children.
Conservative MP for Stratford-upon-Avon, Nadhim Zahawi, claimed to highlight the lax checks done by payday lenders by revealing that he had successfully applied for a loan under the pseudonym Boris Peep.
Labour Adrian Bailey MP, who represents West Bromwich West and is a member of the Business, Innovation and Skills Committee, summarised the comments made in the debate and added: “I recognise that the FCAdoes not have all the powers it needs to do so, and that requires Government to look at other means of addressing the issues.”[/fusion_builder_column][/fusion_builder_row][/fusion_builder_container]