Against efforts from regulators, anti-debt campaigners and religious groups, payday lending in the UK has doubled in the last three years as a growing number of people turn to high-interest loans. The recent Church of England controversy has made the loans, which have previously attracted regulatory interest, a headline affair.
Despite its involvement in investment funds that financed payday lenders, for the most part the Church of England’s objections to payday loans mirror those of most UK regulators and anti-payday loan campaigners. Their primary concern is that the high-interest lenders have left thousands of Britons with rapidly growing debts.
Plymouth council is one of several UK cities aiming to push high-interest lenders out of the market. The city council recently announced that it would ban payday lenders from advertising their services on bus shelters. Leaders believe that the bus ban will cut down access to the lenders’ key demographics and minimise their message.
Other city councils have responded by banning payday lending websites from PCs in libraries and other public buildings. Despite the efforts, however, the trend is clear – more people than ever are borrowing from payday lenders, and fewer are managing to take control of their finances and escape the clutches of a high-interest loan.
In other regions, the public is taking matters into its own hands. Protestors recently voiced their concern over Wonga’s sponsorship of Newcastle United, claiming that a formal endorsement from the payday lending company worsens the problem, which has predominantly targeted low-income families in the Newcastle area.
However, with the cost of living rising and real wages standing still, the root cause of payday lending may be hard to solve. As more councils crack down on high-interest lending, many economists predict that the market may simply grow more aggressive in its remaining marketing channels.
