Sunday 22 September 2013

Glasgow fights back against predatory payday lenders

Payday lenders are under attack in Glasgow like nowhere else in the UK, writes Phillip Inman, Economics Correspondent of The Observer and The Guardian. 

Without waiting for Westminster politicians to tackle the burgeoning instant loan industry, Glasgow City Council has banned all access to Wonga and its lookalikes in libraries and colleges. Glasgow's trading standards officers tour shopping parades to check on offers for loans agreements and APRs that breach the Consumer Credit Act.

Mike Dailly, Principal Solicitor of Govan Law Centre, is challenging the contracts that allow payday lenders to snatch their customers' bank-account funds, while also defending people who, in the most extreme cases, take out £200 loans only to find their home being repossessed.
The crackdown coincides with the biggest promotion of credit unions anywhere in the UK. As an alternative to banks, these unions may conjure up an old-fashioned image in the minds of many people, but in Glasgow they are taking to the high street and can be found inside the swankiest shopping centres. One in four Glaswegians now have a credit union account. 
According to the council treasurer Cllr Paul Rooney, this go-it-alone approach is necessary to scale down an annual £57m binge on payday loans, door-to-door credit and pawnbrokers that affects one in five of the city's population. In November, the council will begin allocating credit union accounts to new secondary school pupils and handing them £10 toward their savings.  Read the full story in The Observer here.


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