In a recent move to protect their students, the University of East London have decided to ban payday loans from their campus completely.
This means that any magazines or posters advertising payday loan companies are now forbidden, as well as access to payday loan websites being completely restricted.
Officials at the university came to the decision after seeing that a number of their students were at a high risk of falling prey to payday loan lenders. Specifically, single parent students are considered to be at the greatest risk, especially when they are struggling to pay the bills and put food on the table.
Many of these single parents have been driven to desperate measures in the past, and it’s all too easy for them to get stuck in a vicious cycle of taking out a payday loan to pay off another.
In some cases, the cycle of debt has become so much, that a minority of students have turned to prostitution and other illegal activities to raise the money necessary to pay what they owe.
The Chaplain of the University, Rev Jude Drummond, recently said, “payday loans lead to desperate measures. We have got a lot of crime and social problems in this area, and a lot of people on the street because of money worries. I’ve seen evidence of people turning to sex work because they can’t make ends meet.”
This move to ban payday loans from the University of East London is sure to be watched closely by other universities around the country. Last year alone, it is estimated that thousands of students got into financial trouble due to payday loans, which means the problem is not unique to London.
In fact, it would not be surprising to see other universities follow suit in the coming months, and ban payday loan companies for good to protect their vulnerable students.
Many payday loan lenders have come under fire in recent years, as experts and government officials warn that they are “almost unlawful” and designed to target the vulnerable.
What is most worrying is the long-term repercussions of getting into trouble with payday loans, especially for students. The financial implications of getting into a lot of debt could haunt them for years to come, and make securing credit in the future almost impossible.
Ultimately, it’s probably safe to say that payday loans were not designed to be a good match for students, and they would be better advised to seek out a student loan to help with their finances.