Response: The Archbishop's bold plan to increase access to low-cost loans
Responding to today’s announcement by The Archbishop of Canterbury, Justin Welby, to allow credit unions to operate from church buildings, Matthew Reed, Chief Executive of The Children’s Society, said:
'The Archbishop of Canterbury should be applauded for taking such a bold stance to tackle the scourge of high cost payday loan companies. Many charge eye-watering rates of interest and drag people into a vicious spiral of debt and despair.
'It’s terrifying to think that each month, one million families turn to high-cost, short-term credit, like payday loans each month and 400,000 are using them for essentials, such as putting food on the table or preventing the gas and electricity from being cut off.
'And recent changes to the Social Fund could mean more families being driven into the arms of legal loan sharks, and other high-cost money lenders, as they have nowhere else to turn to in their hour of need. It’s vital that the money low-income families have goes to supporting their children, rather than paying off extortionate interest rates.
'That’s why The Children’s Society is calling for local authorities, with government support, to help vulnerable families get access to interest-free, or very low cost credit, in a crisis. This will reduce the risk of them being forced to turn to high cost money lenders and driven deeper into debt.'
For more information, please call Andrew Cooper, Media Officer, by telephone, 020 7841 4422, or email.
For out-of-hours enquiries, please call 07810 796 508.
Notes to editors
- The Children’s Society has created an interactive map for people to find out what replacement schemes are being provided by their local authority.
- The Children’s Society wants to create a society where children and young people are valued, respected and happy. We are committed to helping vulnerable and disadvantaged young people, including children in care and young runaways. We give a voice to disabled children, help young refugees rebuild their lives and provide relief for young carers. Through our campaigns and research, we seek to influence policy and perceptions so that young people have a better chance in life.
- In April this year, Community Care Grants (non-repayable grants to help people leaving care settle into the community) and Crisis Loans (for immediate short-term needs, such as food, help to prevent families having their gas or electricity cut off and travel to visit a sick relative), were replaced with Local Welfare Assistance Schemes. Responsibility for delivering the Local Welfare Assistance Schemes was transferred from the DWP to local authorities in England and the devolved governments in Wales and Scotland.