The Competition Commission and payday lending — the cure may be worse than the perceived problem
The rock band Bad Company once said: ‘You never give me my money. You only give me your sympathy.’ Is this the future for consumers of payday loans? Well it could well be if the Competition Commission enquiry leads to a restriction of access to consumer credit for those customers.
In 2010, the Office of Fair Trading (OFT) issued its final report of an extensive and evidence-rich review of high-cost credit. The major finding of that report was that consumers who used high-cost products — including payday loans — had limited options when seeking credit. Mainstream lenders would not provide them with the small loans they required. Thus, absent of any new entry to the high-cost sector, the consumers could only access loans from those who would supply them. The report also found that, generally, standards of customer care in the sector were good. The problems identified were lack of reasoned decision making by consumers and lack of competition between suppliers. The need for these consumers to have access to credit was a clear finding of the OFT.
Now, just four years later, that report seems to have become a forgotten document and we face a Competition Commission enquiry…
If you are registered and logged in to the site, click on the link below to read the rest of the Walker Morris briefing. If not, please register or sign in with your details below.
News from Walker Morris
News from The Lawyer
Briefings from Walker Morris
The Court of Appeal has handed down its decision in Santander UK plc v RA Legal Solicitors.
The well-known US TV series Glee has been on the wrong end of a High Court trademark infringement action.
Analysis from The Lawyer
The law school war shows no signs of ending. But we have, perhaps, reached the end of the beginning.
New EU rules and lawyers’ increased comfort with digital formats are sparking a sea-change in the way law firms manage their documents