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Wirral Euro MP raps consumer credit plans
PLANS announced by the Financial Conduct Authority to regulate consumer credit – including the payday loans industry – have been criticised by a Wirral MEP.
Paul Nuttall, deputy leader of UKIP, said proposals involving payday lenders did not go far enough and a cap on interest rates needed to be imposed.
Mr Nuttall has repeatedly argued against the extortionate interest rates charged by payday lenders.
He said: "The plans are not tough enough and do not address the iniquitous interest rates charged by some firms.
"The FCA has said it believes there is a place for payday lending, but is there?
"Many American states have effectively banned them and other countries, including Australia, had capped the interest rates."
Mr Nuttall went on: "Credit unions are a much better avenue for short term loans and I think the FCA needs to go back to the drawing board as far as payday loan companies are concerned."
The FCA takes over regulating consumer credit from the Office of Fair Trading next April and it has revealed proposals for greater protection for consumers and tougher guidelines for payday lenders.
Advertisements from firms, for instance Wonga and QuickQuid, will also be more tightly regulated and potentially misleading ads will be banned.
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