This week, the Methodist Church, the Baptist Union of Great Britain and the United Reformed Church have called for transparency in money-lending and greater protection for borrowers.
In a submission to the Office of Fair Trading, the Churches assert that money-lenders must give borrowers all the information necessary to make a sensible decision about borrowing.
The submission also criticises the practice of credit dependency, also known as ‘credit slavery’. The Churches assert that lenders should only lend money if a borrower can pay both the interest and the loan amount within a reasonable timescale.
Paul Morrison, Public Issues Policy Adviser, said, “This is an issue that Methodists have been concerned about since before we knew we were Methodists.”
The first Methodist building run by the Wesleys was called the Foundry, as it was the old military cannon works in Woolwich. The upstairs was used for meetings and worship, the downstairs was a loan dispensary to help people to escape exploitative and violent moneylenders.
“Debt and exploitative lending are just as much a problem today as they were in the early days of Methodism. Poverty often means that people come to loans companies in a situation of urgent need and are willing to accept exploitative rates of interest. Borrowers should be treated with dignity and respect, and their lives must not be crippled by the need to service unpayable debts.”
Source: Methodist news Service 22/10/2009