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<p>HM Treasury regularly monitors developments in the consumer credit market, including
those regarding illegal money lending, as part of its normal process of policy development.</p><p>
</p><p>However, it does not conduct its own research as to the scale of illegal money
lending in England. Instead, HMT draws on the research of various stakeholders, including
the Illegal Money Lending Teams (IMLTs), consumer groups and thinktanks, to inform
policy development.</p><p> </p><p>HM Treasury recognises the risks posed by illegal
lenders and the harmful impacts they cause to their victims and communities</p><p>
</p><p>That is why, in financial year 2022/23, the Government will provide over £6.7
million of funding to IMLTs across the UK, an increase of over 5% compared to 2021/22.
This funding enables IMLTs to investigate and prosecute loan sharks and use their
legal powers to tackle the wider criminality they inflict on communities, such as
violence and blackmail.</p><p> </p><p>Consumers use illegal lenders for a variety
of reasons. However, the Government is overseeing many innovative affordable credit
initiatives which will expand the provision of affordable credit to those who may
otherwise use an illegal lender. This includes by:</p><p> </p><ul><li>legislating
to allow credit unions to offer a wider range of products and services;</li><li>providing
Fair4All Finance with £3.8m of funding to pilot a No-interest Loans Scheme (NILS),
designed for consumers in vulnerable circumstances who would benefit from affordable
rather than high-cost credit to meet unexpected costs; and,</li><li>releasing £100
million of dormant assets funding to Fair4All Finance to support their work on financial
inclusion. This includes exploring different methods of advertising affordable credit
products and ensuring vulnerable consumers are aware of all options available to them.</li></ul>
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