Falkirk Council takes an interest in loans

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Councillors have agreed to work together to try to protect householders from controversial pay-day loan firms.

A motion from the Non-Aligned Independent Group that action be taken to identify the potentially damaging impact they could have on communities came before a special meeting of the full council on Monday.

Councillor Brian McCabe said officers should prepare a report on the activities of firms which take advantage of desperate families by lending them cash at shockingly high interest rates.

Mr McCabe claimed: “There are serious concerns over the inadequate self-regulation of this relatively new financial sector industry which has seen a six-fold increase in the number of short term loan companies on our high streets.

“As a council we have to recognise the alarming rise of pay-day loan facilities and officers with our corporate and neighbourhood services and social work services should be working to identify the current use and projected impact on our residents.

An amendment from Labour Councillor Gerry Goldie said that last July the four main pay-day lenders had agreed to Government demands to revise their codes of practice.

The good practice charter signed by 90 per cent of the industry sets out rules they must abide by when dealing with customers, but there is no system in place to monitor whether the code of practice was being adhered to in Scotland

The council therefore called on the Scottish Government to put a similar system in place and agreed to join Citizens Advice Scotland in monitoring the experience of those who have had difficulties with pay-day loan companies.

Officers will also look at ways of making affordable loans more accessible to local householders and report back.

The council will also ask the Scottish Government to extend the code of practice to deal with other high interest long and short term loans companies in a similar way.

The amendment was accepted by all members of the council at the meeting.