Payday Loans
Debate between Baroness Kramer and Lord Popat
Lord Popat
My Lords, the Consumer Credit Act requires lenders to be licensed by the Office of Fair Trading and we are passing these powers on to the new regime of the FCA in 2014. The noble Lord is right: quite often with heavy debt of this nature, the court tends to impose on the consumer a credit embargo or a county court judgment, and the consumer will often find it difficult to borrow money in the future.
Baroness Kramer
My Lords, during the passage of the Financial Services Act, the noble Lord, Lord Mitchell, together with the then Minister, the noble Lord, Lord Sassoon, and, I believe, the most reverend Primate the Archbishop of Canterbury, introduced clauses that gave the new regulator the power to cap the interest rates, fees and other charges of payday lenders. For clarity, will the Minister confirm that these powers are in the legislation and that, when the regulator comes into force laterthis year, we will, as I hope, all press it to make use of them?