Payday lending in the UK: the regul(aris)ation of a necessary evil?

Karen Rowlingson, Lindsey Appleyard, Jodi Gardner

    Research output: Contribution to journalArticlepeer-review

    33 Citations (Scopus)
    91 Downloads (Pure)


    Concern about the increasing use of payday lending led the UK's Financial Conduct Authority to introduce landmark reforms in 2014/15. While these reforms have generally been welcomed as a way of curbing 'extortionate' and 'predatory' lending, this paper presents a more nuanced picture based on a theoretically-informed analysis of the growth and nature of payday lending combined with original and rigorous qualitative interviews with customers. We argue that payday lending has grown as a result of three major and inter-related trends: growing income insecurity for people both in and out of work; cuts in state welfare provision; and increasing financialisation. Recent reforms of payday lending do nothing to tackle these root causes. Our research also makes a major contribution to debates about the 'everyday life' of financialisation by focusing on the 'lived experience' of borrowers. We show that, contrary to the rather simplistic picture presented by the media and many campaigners, various aspects of payday lending are actually welcomed by customers, given the situations they are in. Tighter regulation may therefore have negative consequences for some. More generally, we argue that the regul(aris)ation of payday lending reinforces the shift in the role of the state from provider/redistributor to regulator/enabler.
    Original languageEnglish
    Pages (from-to)527-543
    JournalJournal of Social Policy
    Issue number3
    Early online date3 Feb 2016
    Publication statusPublished - Jul 2016

    Bibliographical note

    Copyright © Cambridge University Press 2016 This is an Open Access article, distributed under the terms of the Creative Commons Attribution licence (, which permits unrestricted re-use, distribution, and reproduction in any medium, provided the original work is properly cited.


    Arts and Humanities Research Council, FinCris project [grant
    number AH/J001252/2].


    • payday lending
    • regulation
    • welfare
    • insecurity
    • financialisation
    • credit


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