Moneylenders claim new code will increase rates

MONEYLENDERS have claimed they would have to increase interest rates to borrowers if tighter new regulations on the sector come into effect.

In submissions to the Financial Regulator on a new consumer protection code due to be introduced later this year, lenders say it will add bureaucracy and costs to their business and drive competition out of the market.

Around 50 moneylenders are licensed to operate in the country, generally providing high-interest loans of several hundred euro a time to an estimated 300,000 customers, whose borrowings are too small or credit ratings too poor to be catered for by the main banks.