“Like it or not, there is a market for credit in this country. Some of the people who purchase credit products – borrow – do so because of their limited means.

“Some people involved in public policy appear to wish that wasn’t the case. But policy cannot be based on aspiration. It must rest on evidence and fact. And the fact is that there is a market for credit products for people with incomes well below the national average. Some of those customers are in poverty. Some have characteristics of vulnerability. All have decided that they will borrow.

Again, some observers appear to wish this was not the case. Sometimes, parts of our political discourse have come close to suggesting that the answer to high-interest rates and controversial lending practices is to regulate out of existence all credit products for people on low incomes. And it would be nice to live in a world where people on low incomes didn’t need to borrow to make it to the end of the month. But until we reach that world, that borrowing will take place.

That being so, the priority for policymakers should be to make sure the market for credit products for people on low incomes works better for those people.”

Social Market Foundation