Payday Lending

The Archbishop of Canterbury has ‘declared war’ on payday lenders, and in doing has been tripped up over his church’s own investment in a private equity group which invests in Wonga.

The Archbishop doesn’t need a lecture from me on hypocrisy, the dangers of inconsistency, or indeed the impact upon personal or organisational reputation.

He has been embarrassed, and he has said so publicly.

Loan depot

Loan depot

But I can’t help feeling there’s a considered strategy in play here.

The idea of church-supported credit unions competing with pay-day lenders is a smart one.

Short term lending is important for many people, and can provide emergency cash to tie people over, without which a job might be lost or a child go hungry.

So the Archbishop recognizes the problem, and intends to follow in the footsteps of others such as the Catholic Church in Ireland, by making use of church premises, manpower, skills, and infrastructure to help those in need.

But the Archbishop needs this matter to be in the headlines.

If church based credit unions are to succeed they need to raise their profile and make a case for why they should be the first choice. And they will need to compete with slick websites and marketing from companies such as Wonga. (Look at ‘Wonga’s Ten Commitments’ on p. 15 of today’s Times).

They will need supporters and advocates.

The internal consistency issue can be rectified. Lambeth Palace is already on the hunt for new staff to support the Archbishop, and after this episode there will certainly be an internal review which takes in reputation risk and internal consistency.

If the Archbishop is as serious about church based credit unions as he seems to be, then we can expect to see a great deal more communication and debate around this issue.

[Photograph: Evening Standard]

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