How awful

A few months ago the Archbishop of Canterbury took time out to preach about how awful payday lenders were. There have been bits and bobs in the papers banging the same drum. And I remember myself being quite startled by the rates in small print at the bottom of the payday lender advertisements that you get in tube trains.

But then I remember that there are people out their who are unable to manage their money, month after month, year after year. It is not just that they have the odd bad month, the odd bad harvest; there is more to it than that. Perhaps they live beyond their means. Perhaps they cannot resist buying that new coat or that old and valuable book. Perhaps they freak out at the sight of a bank statement. But one way or another they need help, and my understanding is that the most available help is that offered by Citizens' Advice (http://www.citizensadvice.org.uk/), who spend a lot of time on this sort of thing. But what Citizens' Advice cannot do is provide the next fix of money. Just that little bit extra to keep one afloat for a few more days.

Regular lenders like banks won't touch such people. They are a bad risk and a lot of bother. They are not good business. So enter the irregular lenders, the loan sharks big and small, who compensate themselves for the risks and the bothers by charging rather high interest rates. But they do provide a service that no-one else wants to provide. Social Services don't want to know. Banks don't want to know. So let's be a bit careful when we come down on the loan sharks and don't wind up chucking the baby out with the bathwater.

So I was pleased yesterday to see a bit of sense creeping into the media coverage, with the Guardian pointing out in the course of two or three column inches that if you put too many restrictions on the trade there won't be any trade. The loan sharks will find something else to shark; perhaps they will move from street loans to street drugs. Perhaps they already do, thus generating useful savings from the common provision of enforcement services, just one pack of attack dogs for the joint operation rather than two.