Compelo Banking - Latest industry news and analysis is using cookies

We use them to give you the best experience. If you continue using our website, we'll assume that you are happy to receive all cookies on this website.

ContinueLearn More

MPs back campaign to limit doorstep loan rates

In the UK, more than 150 MPs have lent their support to a campaign that asks the government to cap the amount of interest charged by doorstep lenders.

This move is the joint work of housing associations and debt lobbying group Debt on Our Doorstep. The groups are campaigning to cap the amount of interest charged by doorstep lenders, who are accused of often offering loans to low income groups unable to make the repayments.

The groups are also calling for home lenders to pass on customer details to major credit reference agencies to allow them to construct a credit history and provide better loans, This is Money has reported.

The report also said the group is battling against what the National Housing Federation has called a vicious circle, when borrowers are unable to get better deals than those offered by doorstep lenders because they do not have a credit history and when they prove they will be a good candidate for a loan, credit reference agencies are not made aware of it.

Doorstep lenders can charge extortionate rates of interest, normally over 200% on loans.

At present over 150 MPs across all parties have signed the House of Commons motion that supports a capping of the interest rates charged by doorstep lenders.