22/05/2013

Call For Executive To Tackle Dangerous Levels Of Payday Lending

The Northern Ireland Executive must do more to tackle the damaging and dangerous levels of payday and illegal lending in Northern Ireland, according to a report produced by NICVA and Advice NI.

NICVA's Centre for Economic Empowerment has commissioned a review of expensive lending in Northern Ireland, both legal and illegal. The report found that both types of expensive lending are having negative impacts on individuals and local communities. They have urged the Executive to do more to tackle the negative aspects of payday and illegal lending.

Seamus McAleavey, NICVA Chief Executive said: "Our review found that it is too easy for people to get into debt with a number of lenders. We saw many cases where a relatively small initial loan spiralled into a debt of thousands of pounds. Ironically it seems that many people’s financial situations actually worsen as a result of using payday loans.

"These loans are being taken out by people on low incomes who are in work, as well as people who are not in work. They are using the money to make ends meet and pay for essential items such as utility bills and school uniforms."

He added: "More worryingly, our review found paramilitary involvement in illegal money lending, mostly in working class communities. Our politicians and police need to take a much more open and robust approach to dealing with this criminal activity.

"We need to look at the multi-agency approach used in Great Britain, where police and Trading Standards work together to remove illegal lenders from the communities they are preying on and to support victims of illegal lending in accessing debt advice and rebuilding their finances."

The review found that for those individuals who find themselves with problem debt, the experience is traumatic and extremely stressful. Those experiencing problem debt reported both personal and familial costs, including depression and suicidal thoughts, and that within families the greatest concern is the impact debt has on children.

(CD/MH)


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