Eu Tackles Payday Lenders As The Uk Drags Its Feet
Press Release - 12 June 2013
As vulnerable people continue to be taken advantage of, a report published by The European Parliament’s Committee on the Internal Market and Consumer Protection (IMCO) has called upon the European Commission to improve consumer finance knowledge. This includes the information made available when choosing a loan to make sure the underhand practices of so many lenders are clamped down upon.
James Benamor, founder and CEO of Amigo Loans comments:
Governments across the EU have failed to act fast enough to save consumers from payday predators. In the UK alone borrowers will continue to be ripped off for at least another two years, while regulators fail to enforce existing rulings and before the Competition Commission steps in. It’s reassuring the EU is taking some action, albeit currently vague in detail, and this needs to be rolled out across all countries where payday lenders are taking root.
The EU shares our concerns that consumers often do not fully understand what they are getting into, meaning vulnerable people end up taking out loans they can’t afford and being exploited by payday loan companies. We desperately need to see reliability, clarity and comparability in the industry, where borrowers can make informed, rational decisions instead of being ambushed into a potentially crippling deal.
Borrowers don’t know what other options are out there and better education is essential to turn this around. Comparison sites generally only list payday providers by order of who pays them the most. What we want to see is an independent comparison service displaying all lenders and allowing borrowers to compare by terms, fees and charges and APR. Until this is done, payday lenders will continue scheming, trapping and dominating, dishing out ‘quick fix’ cash to those who can’t afford it.