A few niche creditors are guilty of “irresponsible lending” over the last ten years, one expert has claimed.
Ian Boden-Smyth, spokesperson for financial standards network UK Insolvency Helpline, said some “adverse credit, high-risk” agencies have been able to pick and choose their rates for a number of years.
This has prevented a number of individuals from accessing funding at reasonable levels, while creditors have been able to have their cake and eat it too, he added.
Mr Boden-Smyth remarked: “It is only now that the government and many free organisations, like ourselves, are fighting for financial inclusion.”
Subjecting low-income people to rates of 90 per cent APR is unacceptable, he implied, when other borrowers are offered different rates.
Children’s charity Barnardo’s launched a campaign earlier this week, which calls for an examination of high-interest lenders and their practices.
In a report by the organisation, it highlights the pressure some people may be under to take punitively high interest loans.
By Francis Finch