Campaigners Call on Banks to Approve Loans to Struggling Consumers

Fri, 19 Feb 2010

Campaigners have called on banks to be less cautious when considering personal loan applications in an attempt to include vulnerable consumers who are currently left with no option but to turn to more expensive forms of credit. The Better Banking Campaign, comprised of community groups and charities, hopes to persuade banks to improve their services to people who are currently excluded having had applications rejected.

The campaigners estimate that between 5 million and 7 million people in the UK are refused access to personal loans, credit cards and overdrafts, leaving them vulnerable to using short term measures such as payday loans as a long term financial solution – a high risk strategy that can lead to debts spiralling. More worryingly, some borrowers are turning to loan sharks. The group also claims that 1.8 million people do not have a bank account, leaving them entirely ostracised from the financial services industry.

Banks continue to display caution in who they lend to, while lenders have been criticised in the past 12 months for failing to pass on interest rates cuts to consumers.

Steve Wyler, spokesman for the campaign, was particularly critical of the nationalised banks who refuse lenders who funded their bailout.
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