Les Ebdon,?who heads the Office for Fair Access, was scheduled to give the keynote address at a Westminster Higher Education Forum event in central London on 5 March, but pulled out because the chief executive of Smart-Pig.com was due to appear on a separate panel.
The company was branded “morally bankrupt” by Martin Lewis, the founder of Money Saving Expert, for failing to state its 1,089 per cent representative APR on a poster aimed at students.
Mr Lewis, the former head of the Independent Task Force on Student Finance, and the Advertising Standards Agency in October, claiming its poster breached their codes of practice.
Professor Ebdon, who was vice-chancellor of the University of Bedfordshire before becoming director for fair access in 2012, told Times Higher Education he “did not feel it would be appropriate for me to speak at a conference on student welfare alongside an organisation which offers high cost loans to students”.
“My advice for students with money worries is to seek impartial advice and help as soon as possible – for example by approaching advice centres at university or student unions or by asking your university or college if you are eligible for a hardship payment,” he said.
Colum McGuire, vice-president (welfare) of the National Union of Students - who that Professor Ebdon had pulled out - also dropped out of the event after learning a Smart Pig representative would be speaking.
The NUS says the company is actually a “loan-day” lender as students borrow ahead of their next student loan payment, rather than a weekly or monthly wage.
Stella Creasy, the Labour MP for Walthamstow and a campaigner against payday lenders, also referred Smart Pig to the FCA over concerns over this “double lending” practice.
Ms Creasy believes this practice breaches FCA guidelines that says lenders must assess whether loans can be paid back “without having to borrow to meet the repayments”.
“It can’t be acceptable to borrow against credit and the regulator needs to step in and if necessary seek legislation to stop it,” .
Tom Parks, chief executive officer at Smart Pig, said it had been a “pleasure”?to talk at the event and was “disappointed that critics felt the need to reject the opportunity to learn more about our story as student entrepreneurs championing good practice in this industry”.
He said that only 2 per cent of students used payday loans, according to last year’s NUS Pounds in Your Pocket survey, so “there are unquestionably other financial and mental welfare issues that warrant priority over this discussion”.
“However, I am pleased that we had a productive discussion with those in attendance.”
Following comments from the conference’s delegates, the company had agreed to feature a note on its homepage reminding students that their university is able to offer financial help and support, as attendees felt existing guidance was not placed clearly enough, he said.
