As research is released showing two thirds of the public back a cap on the cost of credit and so do MPs, Labour MP Stella Creasy today appealed to parliamentarians to listen to the British public and vote for proposals to tackle legal loan sharking. Amendment 40 to the Financial Services Bill will give the new Financial Conduct Authority the power to cap the charges made for credit and so the cost of borrowing, but the Government has pledged to oppose this measure.
Research commissioned by R3, the Insolvency Practitioners, and undertaken by ComRes shows this is out of touch with the views of the majority of MPs and the public.
98% of MPs and 93% of the public believe there is a problem with payday lending.
66% of MPs and 65% of the public support a cap on the total cost of credit.
Speaking ahead of the vote, which is expected late afternoon in parliament, Stella Creasy said:
"This research confirms just how strongly MPs and the public agree we need to tackle the problems caused by payday lenders to British consumers. They see the damage these companies are doing to families struggling in the current climate so it is frustrating that the Government is still refusing to act. This amendment, which has cross party support, would give the new financial regulator the ability to cap what these firms can charge. Without this amendment the Government is setting up the new regulator to fail as lawyers will fight such action and in an industry making millions out of charging extortionate rates of interest for credit fines will only have a limited effect. The millions now struggling with debt as a result of these firms deserve better- I appeal to MPs to vote with their conscience and help end legal loan sharking in the UK."