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PFS’ Richards backs Church payday loan challenge

Keith Richards, chief executive of the Personal Finance Society, said he is pleased to see the Most Rev Justin Welby challenge payday loan companies.

The Archbishop of Canterbury has told Wonga that the Church of England wants to “compete” it out of existence as part of its plans to expand credit unions as an alternative to payday lenders.

The Most Rev Justin Welby said he had delivered the message to Errol Damelin, the chief executive of Britain’s best-known payday lender, during a “very good conversation”.

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Mr Richards said: “The degree of forensic scrutiny placed charges of professional services with the objective of providing fair value and consumer protection, seems to be in direct contrast and contradiction when compared with the 4,000 per cent plus interest charges made by some payday loan companies – it is simply obscene.

“I am pleased to see the Archbishop take up the challenge on behalf of the general public given that our elected government won’t.”

However, the Church of England recently admitted that it invests in one of Wonga’s key financial backers, Accel Partners, who is a US venture capital firm that led Wonga’s 2009 fundraising.