Sinn Féin spokesperson for Finance Pearse Doherty has welcomed new regulations on moneylenders announced today by the Central Bank, but has warned that the only way to protect consumers from rip-off rates and financial exploitation is by capping interest rates.
Deputy Doherty has called for the new Dáil to support his Consumer Credit (Amendment) Bill, which passed Second Stage of the Dáil in 2018 and would place a cap of 36% on the rate of interest moneylenders can charge.
Teachta Doherty said:
“Currently regulated moneylenders are able to charge rates as high as 187% on loans, charging extortionate interest for borrowers and families that are already likely to be under financial pressure.
“Given the economic fallout and job loss that we face today, the risk posed by usurious and extortionate moneylending as never been greater.
“While today’s Central Bank announcement of new regulations on moneylenders is welcome, the ultimate protection for consumers and families is by capping the level of interest they can charge.
“One of the regulations which will take effect from the 1st September, is that moneylenders will be required to include warnings in advertisements for lending where high interest is charged.
“This effectively amounts to moneylenders telling borrowers they will be exploited before they then proceed to exploit them.
“While anything that alerts families and borrowers to the dangers of exploitative lending is welcome, the best way to protect consumers from it is to stop it. That is the job of the Dáil.
“In 2018 the Dáil, despite Fine Gael opposition, supported Sinn Féin’s legislation to place a cap of 36% on the rate that moneylenders and loan sharks can charge.
“In February’s election, Sinn Féin committed to making this legislation law, offering protection to more than 300,000 people who borrow from moneylenders in the State.
“Sinn Féin are committed to moving this legislation forward and capping exploitative moneylending during this Dáil term. This must coincide with reforming restrictive lending rules to allow credit unions to play a greater role in providing affordable credit to borrowers.”
