Christian financial advisors welcome curb on payday loan sharks

The Association of Christian Financial Advisers is welcoming government moves to limit interest rates charged by payday loan sharks and is calling for a drastic cap on the rates charged to protect the vulnerable. The government has announced plans to give the new Financial Conduct Authority powers to limit loan charges, which can run into thousands of per cent, exploiting the vulnerable and exposing them to possible financial ruin.

Last year, ACFA wrote to Chancellor George Osborne expressing 'increasing dismay' over the manner in which Payday loan companies were allowed to trade.

Likening payday lenders to 'loan sharks' ACFA spokesman Aidan Vaughan described the practice of charging exorbitant interest rates as 'unfair and unreasonable to the consumer' and called on the Chancellor to cap rates for all personal lending.

"ACFA is delighted to see the government is now taking action to protect the desperate and the vulnerable from interest rates that are akin to legal extortion," he said today (29 November ). "While there has to be personal responsibility in taking out loans, the feeding frenzy of greedy loan sharks has to be curtailed. We believe all interest rates on personal loans should be limited by law."

The incoming Archbishop of Canterbury, Justin Welby, has used the words 'immoral' and 'usury' to describe the practice of charging excessive interest rates, and Labour peer Lord Mitchell has criticised an 'industry run by cowboys on the fringes of legality' condemning the vulnerable to a 'hell-hole of grinding debt.'

The Financial Services Bill returns for its third reading next week and has cross-party support.

ACFA is the UK network of Christian financial advisers and related professionals. It aims to be the voice of Christian financial advice and champions best practice in the UK. The ACFA website offers links to Christian financial advisers across the UK. For more information see: www.christianfinancialadvisers.org.uk