Actor and debt campaigner Michael Sheen is backing calls for a Fair Banking Act to help tackle unaffordable credit and problem debt.
In a documentary, ‘Michael Sheen's Secret Million Pound Giveaway’ Sheen joins the Fair Banking for All Campaign to call on the UK Government to pass a new law, a Fair Banking Act. They say this would help create real alternatives for people who are turning to payday loans or loan sharks because they cannot get a loan from a high street bank.
Kay Polley from the Fair Banking for All Campaign said:
“Michael Sheen has shown in the documentary that the UK is in a credit crisis, and that the Government has the power to take action on it. A Fair Banking Act would help the huge numbers of people who are trapped in cycles of debt with loan sharks and high-cost lenders, whilst at the same time driving capital to thousands of small businesses, fueling the shared economic growth that the Government is aiming to achieve. Credit isn’t a solution to poverty, but it can be a vital lifeline for people needing relatively small short-term loans, preventing difficult situations escalating into real crises.”
The legislation would push high street banks to provide more affordable credit to people on low incomes and to small businesses, or to support community-based credit providers such as credit unions and CDFIs (Community Development Finance Institutions) to do so.
Recent research suggested that a Fair Banking Act could lead to a 13-fold increase in the level of annual lending by responsible credit providers from an estimated £250 million per year now up to a £3.3 billion per year with a Fair Banking Act in place.
In 2022 – 2023, more than 9 million people were declined for credit, with millions relying on pay-day lenders.
Michael Sheen said:
“Anyone can find themselves in a place where they need credit to make ends meet or to get through a difficult time. The lack of affordable credit for people on lower-incomes is harming individuals and families, but also businesses and communities. Whole regions are seeing their growth held back. We can’t keep waiting and hoping that things will get better. We need something to change now. The Fair Banking Act could be the thing which really makes the difference”.
Many small businesses report that a lack of access to affordable loans is the single biggest barrier to them building and investing in their business. Sian from Llandelio wanted to start her own craft business and applied for a loan from the high street bank where she was a customer, but was turned down. She then contacted CDFI Purple Shoots, who sat down with her to discuss her business plan, and were able to offer her a small start-up loan.
Sian said:
“If it wasn’t for schemes like Purple Shoots who invest and support not only the business but also the person, I don’t know where I’d be.”
99% of businesses supported by CDFIs in 2023 had already been declined by another lender, yet they went on to create and safeguard more than 12,000 jobs.
