Martin Wheatley
25 The North Colonnade
Canary Wharf
London E14 5HS

Ref: Oth.CSJ.C0019.CM.04.12.13

Date: 4^th December 2013

Dear Martin,

I welcome the news that the Financial Conduct Authority’s (FCA) has developed new proposals for regulating payday lenders and that you are also planning research on the impact of capping the total cost of credit. I am keen that this should be undertaken as soon as possible.

I would also like to call on the FCA to ensure that any regulation goes much further than is currently planned and is in line with the recommendations of the “Charter to Stop The Payday Loan Rip-Off”. As I am sure you are aware, this includes the following:

• Stop loans being made to people who can’t realistically afford to pay them back.
• Stop the pay day loan companies from repeatedly rolling over loans and creating spiralling debt.
• Stop hidden or excessive charges.
• Stop the raiding of borrowers’ bank accounts without their knowledge and leaving them in hardship.
• Stop irresponsible advertising and instead provide clear and transparent information.
• Require lenders to promote free and independent debt advice, and ensure they co-operate with other services to help people get out of debt.

I believe the advertising aspect is especially important and you may know that the Green-led council in Brighton and Hove has banned payday loan companies from using local authority billboards. I know other local authorities have taken similar action and I hope that the FCA will also be prepared to take action in support of a ban on payday adverts, especially those that are misleading.

As a sponsor of a Private Members Bill that reflects the demands of the “Charter to Stop The Payday Loan Rip-Off,” I think it’s critical to take steps to restrict access to credit. At the same time I would like to see the underlying problems, namely that this kind of credit is too expensive properly and robustly addressed as well. In part this is about tackling charges but it’s also about giving people other options. So I would also like to take this opportunity to encourage action by the FCA to support the growth of credit unions and other forms of more responsible lending, as well as more pressure on banks to increase the availability of credit to people on low and middle incomes.

Yours sincerely,