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20/11/2012
OFT Investigates Payday Lenders
The OFT has opened formal investigations into several payday lenders over aggressive debt collection practices.
It is also today writing to all 240 payday lenders highlighting its emerging concerns over poor practices in the sector.
These actions are set out in a progress report published today as part of the OFT's compliance review of the payday lending sector. It highlights concerns about:
•the adequacy of checks made by some lenders on whether loans will be affordable for borrowers
•the proportion of loans that are not repaid on time
•the frequency with which some lenders roll over or refinance loans
•the lack of forbearance shown by some lenders when borrowers get into financial difficulty
•debt collection practices.
The OFT is continuing to gather and analyse information about the activities of payday lenders as its compliance review progresses. It also expects to warn the majority of the 50 firms inspected, which account for the majority of loans, that they risk enforcement action if they do not improve specific practices and procedures which came to light when they were inspected. The OFT will require those lenders it warns to provide it with independent audits to verify that they have improved their practices and procedures to comply with legal obligations and expected standards.
The OFT will publish a full report in the New Year setting out further findings on compliance, including whether wider action is needed to tackle problems in the sector.
David Fisher, OFT Director of Consumer Credit, said: "We have uncovered evidence that some payday lenders are acting in ways that are so serious that we have already opened formal investigations against them. It is also clear that, across the sector, lenders need to improve their business practices or risk enforcement action.
"Our report shows that a large number of payday loans are not repaid on time. I would urge anyone thinking about taking out a payday loan to make sure they fully understand the costs involved so they can be sure they can afford to repay it."
(CD)
It is also today writing to all 240 payday lenders highlighting its emerging concerns over poor practices in the sector.
These actions are set out in a progress report published today as part of the OFT's compliance review of the payday lending sector. It highlights concerns about:
•the adequacy of checks made by some lenders on whether loans will be affordable for borrowers
•the proportion of loans that are not repaid on time
•the frequency with which some lenders roll over or refinance loans
•the lack of forbearance shown by some lenders when borrowers get into financial difficulty
•debt collection practices.
The OFT is continuing to gather and analyse information about the activities of payday lenders as its compliance review progresses. It also expects to warn the majority of the 50 firms inspected, which account for the majority of loans, that they risk enforcement action if they do not improve specific practices and procedures which came to light when they were inspected. The OFT will require those lenders it warns to provide it with independent audits to verify that they have improved their practices and procedures to comply with legal obligations and expected standards.
The OFT will publish a full report in the New Year setting out further findings on compliance, including whether wider action is needed to tackle problems in the sector.
David Fisher, OFT Director of Consumer Credit, said: "We have uncovered evidence that some payday lenders are acting in ways that are so serious that we have already opened formal investigations against them. It is also clear that, across the sector, lenders need to improve their business practices or risk enforcement action.
"Our report shows that a large number of payday loans are not repaid on time. I would urge anyone thinking about taking out a payday loan to make sure they fully understand the costs involved so they can be sure they can afford to repay it."
(CD)
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06 March 2013
Payday Lenders Risk Losing Licenses
The OFT is giving the leading 50 payday lenders, accounting for 90 per cent of the payday market, 12 weeks to change their business practices or risk losing their licences. They uncovered evidence of widespread irresponsible lending and failure to comply with the standards required of them.
Payday Lenders Risk Losing Licenses
The OFT is giving the leading 50 payday lenders, accounting for 90 per cent of the payday market, 12 weeks to change their business practices or risk losing their licences. They uncovered evidence of widespread irresponsible lending and failure to comply with the standards required of them.
07 March 2012
Report Calls For Tighter Controls On Payday Loans
A report has recommended that lenders of payday loans should be forced to limit loans being ‘rolled-over’, stop letting customers switch lenders and to share customer information with other lenders.
Report Calls For Tighter Controls On Payday Loans
A report has recommended that lenders of payday loans should be forced to limit loans being ‘rolled-over’, stop letting customers switch lenders and to share customer information with other lenders.
05 November 2013
Lewis Slams Payday Lenders
MoneySavingExpert.com creator Martin Lewis has told MPs payday lenders are "in danger of grooming a new generation to this type of borrowing". Mr Lewis joined other consumer groups, regulators and payday loan firms at a Business, Innovation and Skills Select Committee hearing into the industry this morning.
Lewis Slams Payday Lenders
MoneySavingExpert.com creator Martin Lewis has told MPs payday lenders are "in danger of grooming a new generation to this type of borrowing". Mr Lewis joined other consumer groups, regulators and payday loan firms at a Business, Innovation and Skills Select Committee hearing into the industry this morning.
28 March 2012
Football Fans Call On Clubs To Stop Running Payday Loan Adverts
Fans of 18 football clubs have come together to petition their respective clubs to stop carrying advertising by payday loan company Wonga on their websites. The group, lead by Northampton Town supporter Bob Ward and grandson Dan, are also encourage fans of more than 60 other clubs to do the same.
Football Fans Call On Clubs To Stop Running Payday Loan Adverts
Fans of 18 football clubs have come together to petition their respective clubs to stop carrying advertising by payday loan company Wonga on their websites. The group, lead by Northampton Town supporter Bob Ward and grandson Dan, are also encourage fans of more than 60 other clubs to do the same.
15 February 2013
Citizens Advice Call For Immediate Suspension Of Payday Loan Co. Licenses
The Office of Fair Trading (OFT) are being urged to use new powers to immediately suspend the licences of four payday lenders, who Citizens Advice claim are "causing significant distress" to customers.
Citizens Advice Call For Immediate Suspension Of Payday Loan Co. Licenses
The Office of Fair Trading (OFT) are being urged to use new powers to immediately suspend the licences of four payday lenders, who Citizens Advice claim are "causing significant distress" to customers.
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