Church of England hires Hector Sants to lead crackdown on payday lenders

The Archbishop of Canterbury has asked the former City regulator to spearhead a campaign against payday lenders such as Wonga.

by Elizabeth Anderson
Last Updated: 28 May 2014

Last year, Archbishop of Canterbury Justin Welby threatened to put controversial payday lenders out of business by setting up Credit Unions in churches.

This week Welby has stepped up his campaign by approaching Hector Sants, the former boss of the FSA, to lead a new financial taskforce dedicated to developing the credit unions and encouraging more community-based financial services.  

The church said on Thursday that Sants had accepted the invitation to chair the body, which will be called the Task Group on Credit Unions and the Financial Sector, and he will work one day a month (Errol Damelin must be quaking in his boots).

The move marks a surprise return for Hector Sants, who recently resigned from Barclays due to stress and exhaustion. In November, he stepped down as Barclays’ head of compliance and government and regulatory relations after 10 months in the role. Previously he was head of the Financial Services Authority from 2007 to 2012, steering the organisation through the financial crisis.

‘I have long recognised that the banking sector requires cultural change,’ Sants said in a statement confirming his new appointment.

The Church of England has been on a recent push to crack down on payday lenders such as Wonga, which charges annual interest rates of 5,853 percent. In July last year, Welby said he had met the head of Wonga and had told him ‘quite bluntly’ that he was ‘trying to compete [him] out of existence.’ However, he also acknowledged that it could take a decade for the credit unions to take off.

It later emerged that the church had an indirect investment in Wonga and, as of last month, the church still held its £80,000 stake.

Despite the controversy after the investment was revealed in July, the archbishop told Radio 4’s Today Programme in late December that the commissioners who manage the church’s investment portfolio still hadn’t worked out how to get rid of it.

Find this article useful?

Get more great articles like this in your inbox every lunchtime

Subscribe

Get your essential reading delivered. Subscribe to Management Today