Labour councillors in Tower Hamlets have welcomed the recent news that the Government will introduce legislation to cap interest rates, which can be as high as 5000% APR, on so-called “pay day loans”. The move follows months of campaigning by Labour politicians and activists, including those in Tower Hamlets.
Whilst welcoming the Government’s U-turn Labour argue that more can be done to tackle to the impact of pay day lenders who they argue have a disproportionate effect on the most vulnerable people in society.
At Wednesday’s Council meeting Labour proposed new measures to ban payday lenders from advertising in council publications or setting up business in council owned properties.
Alongside steps to limit payday lenders Labour argued that the Council should could do more to encourage residents to use local credit unions as well as providing better financial education.
“Although the announcement from the Government on capping interest rates is obviously welcome news, they could be doing a lot more. We have called on the Mayor to take a number of practical steps to protect vulnerable residents from falling into debt. Once again it is Labour politicians leading the way on tackling pay day lenders. I hope that the Mayor will heed our call and make sure that the Council does all it can to protect people from these legal loansharks.
“I would also like to thank Just Money for their petition on this issue and for all their work campaigning against excessive payday lender charges.”