Saturday 1 October 2016

Finally, the vulnerable may escape this scourge

Published 25/07/2016 | 02:30

The state is attempting to tackle the issue of moneylending (stock photo)
The state is attempting to tackle the issue of moneylending (stock photo)

After decades of turning a blind eye to what is a social blight, the State is to finally ratchet up the pressure on moneylenders.

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They prey on the vulnerable, with tempting offers of cash being flashed on the doorstep.

There is no need to go out and seek their services, they will come to you and hand you the cash immediately.

This leads to a situation where people get sucked into a never-ending cycle of borrowing from the loan sharks.

Back in 2013, research conducted for the Central Bank estimated there were 360,000 customers of moneylenders.

That number has probably risen to 400,000 now.

These moneylenders, who are lightly regulated by the Central Bank, are permitted to charge up to 200pc interest on their loans.

And that is just the 40 legal moneylenders that are licensed by the Central Bank.

Worrying

Thousands more socially and economically deprived people have to resort to using illegal moneylenders.

And worryingly, more than one in five customers have loan arrangements with more than one moneylender.

The sector is flourishing, especially since the financial collapse which started in 2008.

It is nothing short of extraordinary that moneylenders, both legal and illegal, are so strong in a country that has one of the most extensive networks of credit unions in the world.

Credit unions should be the natural choice for those unable to get credit elsewhere.

Now credit unions nationwide are to get their chance to put the squeeze on the door-step loan sharks, with the new easy-to-get loans available.

At last, economically deprived people may finally be able to slam the door in the faces of the moneylenders.

Irish Independent

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