TWO councillors at Warrington have taken up the cudgels on behalf of low-income families who fall victim to payday loan companies.
Cllr Maureen McLaughlin (pictured) and Cllr Linda Dirir have tabled a motion for next week’s borough council meeting calling on the government to set a limit on payday loans interest rates.
The motion notes with concern that the continued rise in food and fuel prices is hitting low-income families in Warrington and that more than 60 per cent of people taking out payday loans use the money to pay for household bills and essential items.
Cllr McLaughlin says payday loan companies are able to charge exorbitant interest to a percentage rate in the thousands – and can require borrowers to sign a “continuous payment authority” which allows them to take payments directly from bank accounts.
One in 10 payday loan users are foregoing food to pay their debts and are being forced to rely on food banks.
The motion claim the government’s Universal Credit system, due to start from April, could further exacerbate the probem.
It calls on the council to urge the government to honour its recent commitment to legislate to give authority to the new Financial Conduct Authority (FCA) to set a limit on payday loans interest rates, to call on the government to ban or restrict advertising by payday loan companies .
*The Government has said it will give the FCA the power to cap interest rates charged by payday loan companies.
War declared on payday loan companies
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It all seems very laudable but do they not have confidence in the likes of Helen Jones do deal with such matters in the correct forum , i.e. Parliament or do they just want to deflect attention away from their deficinecies in running the council. It is a pity that they want to spend their time on party politics and national issues rather than improving services in Warrington. Including a reference to the Universal Credit system would seem to indicate a desire to use council time score political points basd on NATIONAL issues, perhaps they should also include an acknowledgment of their own party’s economic failings – just to balance it out.
If the council had spent a bit of time over the years promoting Credit Unions, a lot of these problems would have been avoided. But it is not too late to start.