Bevan Foundation welcomes cap on payday loans

payday concept calendar with marker and circled day of salary
NewsJanuary 3rd, 2015

On the day that a new ‘cap’ on the amount of interest that can be charged on pay-day loans came into force, the Bevan Foundation welcomed the change.

Speaking to the Western Mail, Bevan Foundation Director Victoria Winckler said that although the cap of 0.8% a day was still far greater than a standard commercial rate for loans, it was an improvement on the previous position when lenders could charge what they liked.  Victoria explained that typically people used payday lenders because they had been rejected for mainstream credit, and that they therefore face higher charges because they are regarded as a greater risk than other borrowers.

Dr Winckler questioned whether lenders would tighten their criteria forcing people seeking credit turn to loan sharks.  She said that at this stage fears the rules could open the door to loan sharks were “just speculation” based on US research.  She added: “Let’s see what the outcome is, but from my own point of view the new cap is very welcome.”

Read our report on overindebtedness in Wales here.

The Western Mail article is available at:

Tagged with: Media coverage


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