One provider of instant cash loans to borrowers in the UK has stepped forward to speak out against the criticisms leveled against the payday advance industry that has culminated with an investigation into the lending practices of the sector by the Office of Fair Trading.
The instant cash loan provider, North West-based Umbrella Loans, welcomed the OFT’s investigation, with director Charlotte White stating that those companies that practice in an ethical manner need to stand as proof that running a responsible business is the rule and not the acception. The amount of negative press surrounding the industry has been massive, Ms White said, and in a move designed to resonate with industry critics that have argued that payday lenders act in an irresponsible manner, the payday lender has announced that it will apply as standard practice any and all recommendations made by the OFT.
Many mainstream news outlets have been reporting on alleged predatory lending practices employed by providers of short term loans in the UK, publishing reports of lenders giving out cash to individuals without checking if the borrower will be able to repay the funds easily. Other reports have been made of lenders soliciting business from vulnerable classes of Brits, such as students, the military, jobseekers, and pensioners.
David Fisher, the OFT’s consumer credit director, remarked that there may be a select number of lenders breaching the Consumer Credit Act in their zeal to drive business and thus not meeting the watchdog’s responsible lending standards. Mr Fisher, who called such actions ‘unacceptable,’ added that the OFT will work with the various lending trade bodies in order to increase standards, but said that taking enforcement action was also a possibility as well.