Tuesday 17 September 2019

'When will I be free?' - charity wants tobacco-style warnings on moneylender loans

Most of the people using moneylending services are low-income consumers and regarded as financially vulnerable. (Main image posed by models)
Most of the people using moneylending services are low-income consumers and regarded as financially vulnerable. (Main image posed by models)

Gabija Gataveckaite

St Vincent de Paul (SVP) has called for a tobacco-style warning to be introduced on moneylender loans.

The charity has stated that its volunteers encounter "vulnerable" people during home visits who resort to moneylender loans to pay for short-term expenses but do not have access to information for other forms of funding.

"I only wish I had not been so stupid, every day the debt hangs around my neck. I’m always worrying about how I’m going to get money and how am I going to pay back the loans and look after the girls," an anonymous SVP member said.

"When will I be free?"

The charity has filed a submission to the Department of Finance calling for tobacco-style warnings to be introduced on moneylender loans.

According to SVP, a warning statement such as 'Warning: this is a high cost loan' should be included in all advertising related to moneylending.

"It is astounding that this is not currently a requirement," the charity's submission reads.

"In our experience, leaflet drops tend to take place at “peak time” for low income and vulnerable households seeking to access credit, for example, Christmas, back to school, Communion and Confirmation.

"Given the relationship that can exist with an agent calling to a home on a weekly basis there is also a need to ensure that agents do not promote new loans when customers are nearing their final repayments," the submission adds.

According to SVP spokesperson Jim Walsh, the submission was triggered by what volunteers were encountering during home visits.

"It comes from when SVP volunteers who visit people and discover people who have found themselves in some difficulty paying extortionate interest rates and most of the time, these people are vulnerable," he told Independent.ie.

"People on low income struggle when it comes to expenses, for example, a new washing machine. They look for money and moneylenders and convenient, but there's a real problem where there is no access to information or other forms of funding," he added.

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