If ever there is a company representing the most abhorrent and vile aspects of modern Britain, Wonga is surely it. Today, I make the case for taking the fight to payday loans companies which represent the financial sector at its very worst. The time has come, I argue, for a state-run alternative to Wonga.
With Christmas just around the corner, it's that time of year when statistics emerge to tell us how many people will fund their annual festivities with some form of short-term credit. This year, the Government-backed Money Advice Service has said that over a million people are considering using a payday loan to fund Christmas; a worrying indication of how deeply ingrained this form of high-cost credit has become in British life.
Payday Loans have become a hot topic and a regular feature in the British press week in, week out. The market has grown significantly and although the Office of Fair Trading (OFT) have no official figures on exactly how much the sector is worth it estimated it at around £900 million in 2008 with Consumer Focus estimating the total value of loans made in 2009 at £1.2 billion.
This Friday, the High Cost Credit Bill returns to the House of Commons to resume its Second reading debate, following a Backbench Business debate on the same issue this Thursday. Unfortunately, due to the lack of Government support, there is a real risk that it will not be granted sufficient time for debate in this current parliamentary session.