Statement from the leader of Leeds City Council re the OFT referring payday lenders to Competition Commission
Councillor Keith Wakefield, leader of Leeds City Council, said:
“I am relieved that the Office of Fair Trading has decided to refer payday lenders to the Competition Commission. The OFT itself has said that these lenders cause ‘misery and hardship for borrowers’ and, as we are all too aware in Leeds, this is a growing problem for big cities like ours.
“I welcome the Competition Commission’s investigation and am hopeful they will see to put a cap on the interest rates charged by these companies. I think it is vital they put a stop to the phenomenally high rates they currently charge which often result in spiralling debts and the many related problems this can cause, like stress, health issues and relationship problems.
“In Leeds we have recently announced a raft of measures to tackle poverty and its wider effects, which includes developing a high profile campaign to raise the issue of pay-day lenders, high cost loans and illegal money lenders.
“We want to make sure everyone knows these aren’t the only option, so we will be increasing our support for credit unions, and lower-cost borrowing options like Leeds City Credit Union and the Headrow Money Line, as well as making sure people can get easy access to good financial advice.
“Poverty is the biggest challenge our city is facing so in order to tackle this head on we have also taken the dramatic step of rearranging our services to create a new directorate which brings together services to support people to get out of poverty.
“As well as making our services more accessible to those most in need, we’ll also be joining up with partners from voluntary and advice organisations to make sure that the support we provide together can lift people out of poverty.
“With the right support we are confident people will stop turning to high cost lenders in times of need.”
For media enquiries, please contact:
Emma Whittell, Leeds City Council press office, on (0113) 2474713