MPs want cap on interest rates
18 Dec 07
Move aimed at ending exploitation of the poor and financially uneducated
MPs have called for courts to be given the power to cap interest rates that penalise the poor and the financially uneducated.
A report from the House of Commons Scottish Affairs Committee says the power should be introduced where it would prevent "severe poverty or destitution". The report attacked financial institutions it sees as having based a thriving industry on exploitation.
Some members of the committee have also called for a legal cap on interest rates.
Ian Davidson, the Labour MP for Glasgow South West, said he was in a favour of an overall cap, but that it would probably be easier to get agreement on the courts taking action first.
Mohammed Sarwar, MP for Glasgow Central and chairman of the committee, said it was frighteningly easy for people borrowing small amounts of money to get into huge amounts of debt, due to high levels of interest and service and penalty charges.
The measures proposed are part of a wider report by the committee on poverty in Scotland, including barriers to finding work and even the measure of poverty adopted by the government.