*** DEBUG END ***

Develop credit unions, Welby urges

05 July 2013


Common ground: a speaker, sporting a Robin Hood hat, addresses the launch of Nottingham Citizens at the city's Albert Hall, on Thursday of last week, attended by more than 900 people. Nottingham Citizens is an alli­ance of churches, mosques, schools, and other groups, which intend to act together for the common good

Common ground: a speaker, sporting a Robin Hood hat, addresses the launch of Nottingham Citizens at the city's Albert Hall, on Thursday of last week...

THE Church is in a "unique position" to develop credit unions as an alternative to payday lending companies, the Archbishop of Canterbury has said.

Speaking in the House of Lords on 20 June, in a debate on alternatives to payday lenders, Archbishop Welby said that "some five million people in this country use payday loans. . . The situation is becoming too big to ignore.

"It is quite clear, when I look at what is happening on the high street, and in our local communities - particularly in the most deprived areas - that . . . alternatives [to payday lenders] are very few and far between. My own group, the Church, can play a part in the development of credit unions up and down the country. . .

"For the credit-union movement to be successful and sustainable, and other forms of local finance to develop, we need a bottom-up movement of local organisations' working to change the sources of supply. It will take many years - ten to 15 years - but it must start now."

The Office of Fair Trading (OFT) announced on Thursday of last week that it would refer the payday lending industry in the UK to the Competition Commission, because of concerns about "deep-rooted problems with the way competition works". Earlier this year, the OFT gave the leading 50 payday lenders "12 weeks to change their business practices, or risk losing their licences" ( News, 15 March).

The Government convened a "summit" on Monday, at the Department for Business, Innovation, and Skills (BIS), to address concerns about the payday lending industry. Speaking after the summit, the Economic Secretary to the Treasury, Sajid Javid, said that the Financial Conduct Authority, which will regulate the industry from 2014, would have "some real teeth. They're going to feel the hand of the regulator on their shoulder".

BIS has commissioned research into the effect of advertising by payday lending companies on consumer behaviour, which will be published in the autumn.

Payday lending companies have come under pressure from activists in recent weeks. A group of campaigners from the University of East London, and the community organisers Citizens UK, has secured a meeting with an executive from the Money Shop, a payday lending firm, and will request that the company end practices such as rolling over loans and selling multiple loans. The campaigners also requested that the company advertised free debt-counselling services in its branches.

Bishop backs voucher scheme. The Bishop of Ripon & Leeds, the Rt Revd John Packer, has endorsed a voucher scheme, "Give Us Some Credit", which has been commissioned by St George's Crypt, in Leeds, as a way to help people who are begging. Vouchers can be bought from the Crypt, and given to people who are begging. They can be redeemed at one of the Crypt's cafés.

Welcome to the Church Times

​To explore the Church Times website fully, please sign in or subscribe.

Non-subscribers can read four articles for free each month. (You will need to register.)