Cochrane backs Office of Fair Trading report into payday loan companies

Alliance Finance spokesperson Judith Cochrane MLA has backed the report by the Office of Fair Trading into the practices of payday loan companies. The report found bad practice including the failure to determine if customers could repay their loan and also that many companies were relying on loans not being repaid. It has told the companies to change this practice or risk losing their licence.

Judith Cochrane MLA said: “These payday loan companies are not the correct long term solution to the financial problems that many people are facing.

“I welcome this report by the Office of Fair Trading as there has been great concern that these companies were only being lightly regulated and profiting from many vulnerable people who have found themselves in debt.

“People who take out these loans are not made fully aware of the consequences of not repaying the loan on time. The bad practice operating in this sector must end and the Office of Fair Trading must follow through with their threat to remove the licence from any company that does not change the way it operates.

“Banks also have a role to play in reducing the reliance on payday loans by offering suitable credit to those who need it.”

ENDS