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Short Term Loans Are Needed

Written By On 27/10/2013

Sue Lewis, the recently appointed chair of the independent Financial Services Consumer Panel, spoke to a Sunday newspaper about short term loans and some may be surprised at her views. She said they were 'a good product' that the public needed.

The head will advise the FCA, the new City watchdog, and she believes that if one was to use their credit card to pay for an evening out or a restaurant bill, then nobody would bat an eyelid. She feels that using a payday loan from a reputable source instead for the same reasons should not be looked at any differently.

Ms Lewis said in her interview with The Independent

Things that are just as bad go on in banks or credit cards, such as having your credit card limit increased, or the bank letting you slip into an overdraft and charging you.

She feels that short term lending has become an easy target to victimise whilst banks and credit card companies have been flying under the radar for what can be far worse at times.

However, she does not defend the lenders who use 'bad practices' such as too many rollovers which the new watchdog intend to stamp down on. But she is convinced that these types of loans have a very useful part to play in today's society and they must not be prevented, but just enhanced.

A recent study suggested that many people across the UK are needing to take out a short term loan most months just to afford the basics in everyday living such as supermarket costs.

Clearly Ms Lewis is not a supporter of such loans being used under such circumstances as she feels that this type of loan applicant is obviously not in a situation to continue living this way. She added

That's a social problem that no amount of regulation can fix.