Ten years ago I wrote a report for Church Action on Poverty on the need for an interest rate cap on loans made by doorstep lenders in the UK. It was one of the very first such demands. It pioneered disclosure of abusive interest rates - which no one had realised were as high as they were until that point.
This morning George Osborne has confirmed such a cap will happen.
I have had no recent significant involvement in this campaign: credit goes to others, of course. But it's good to see another campaign begin to reach fruition.
The sad fact is there are still many more to go. I won't be hanging up my keyboard any time soon.
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Interesting how Osborne will cap this whilst maintaining a Housing Ponzi scheme that syphons off wealth from another source, not to mention a total reluctance to cap energy bills and break up the oligarchy there. It is good that this has happened but just means the scam potential moves somewhere else.
A Tory MP referred to the idea of capping energy prices as ‘Stalinistic’, what is the difference here? It’s Stalinistic when it affects their shares but ‘moral’ when it doesn’t!
I really wish this will work. Sorry for Newcastle supporters!
But what will/can be done about loan sharks? There is a real risk of getting criminality in through the back door.
Maybe that the Church of Englands initiative to support credit unions and allowing free access to its premises is actually an even better initiative, creating hereby real competition.
The rate mentioned this morning of 20% upfront fees and 4% monthly is actually 92% APR. This is a lot, but in line with what Justin Welby mentioned in a radio interview a few months ago. (assuming a 12 months loan)
I have never understood why we allow these outrageous charges and interest rates to be legally enforceable. By doing this we are actively supporting Wonga and their friends. Debts should only be legally enforceable if they conform to appropriate standards.
@ Michael G. Michael – you quite rightly say “Debts should only be legally enforceable if they conform to appropriate standards.”
Alas, however, that would mean the international “creditors” couldn’t exact their “pound of flesh” and more – FAR more – from debtors whose debts were often fraudulently contracted.
See, for example, this latest e-mail I have received from the “Jubilee Debt Campaign”
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Two weeks on from Typhoon Haiyan in the Philippines, the British public have responded with incredible generosity, donating over £50 million to the Disasters Emergency Committee so far.
Yet the shocking truth is that the same amount of money leaves the Philippines in debt payments every three and a half days.
Let’s call on the World Bank and other international lenders to drop the Philippines’ debt now
In fact, since the typhoon struck on 8 November, the Philippines has spent more than £230 million paying off overseas debts. And it will spend a total of £5 billion this year.
Make no mistake, the Philippines urgently needs emergency assistance to cope with the devastation the typhoon has caused. But in the weeks and months ahead, as the world’s media moves on, the government will also need funds for rehabilitation of roads, bridges, schools, hospitals and other infrastructure, to get the affected regions back on their feet.
Tell the international lenders claiming money from the Philippines to drop the debt now >>
The horrendous impacts of the world’s largest ever recorded storm are reason enough why public lenders like the World Bank and the Asian Development Bank should question the $60 billion debt burden claimed from the Philippines.
Yet many of these debts are inherited from the odious rule of Ferdinand Marcos in the 1970s and 80s – a period of Martial Law when loans poured in from these same international lenders, who turned a blind eye to the government’s crimes and corruption. As our partners in the Freedom from Debt Coalition, Philippines, ask: ‘Why pay debts we don’t owe?’ FDC are calling for an audit into the debts to find out which are illegitimate and should never be paid.
What’s more, while the rich world has sent its aircraft carriers to the Philippines to dispense aid on TV, away from the cameras their negotiators have been resisting a fair deal to compensate impoverished countries for the impacts of extreme weather events worsened by climate change. Campaigners in the global South point out that rich industrialised countries owe a far greater climate debt to the Philippines because of their excessive greenhouse gas emissions, which are causing climate change.
Please sign and share the petition on the Philippines’ debt to Jim Kim, President of the World Bank, and other lenders, today >>
Best wishes,
Jonathan Stevenson
Jubilee Debt Campaign
PS. The Philippines’ deadly debt burden doesn’t change the urgent need for emergency shelter, clean water and food. If you haven’t donated yet, our members including ActionAid, Christian Aid, Islamic Relief, Methodist Relief and Development Fund and Tearfund are all part of the relief effort.
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Getting these “creditors” to give up their easy income stream will be very hard – like the debt-junkies they are, weaning them off their easy money will take REAL concerted, on-going, international action and real solidarity.
“The government has sold £890m of student loans to a debt management consortium for £160m”
Yeeeeessssss……sound economics.
These are student debts dating from 1998 and earlier which clearly HMG have not been able to collect for a minimum of 15 years.
If the money is just sat there for the collecting, don’t you think more would have been bid?