The Scotsman cartoon: Financial mean streets

Payday loans costs will be capped under plans announced by Chancellor George Osborne.

Illustration: Iain Green
Illustration: Iain Green

New financial regulator the Financial Conduct Authority will set the level of the cap, which will cover fees charged on the loans as well as interest.

Meanwhile, a review has found RBS staff are turning away too many small business loans at an early stage partly because they face increasing sanctions for putting through applications that “turn bad”.

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The report by former Bank of England deputy governor Sir Andrew Large found that up to 10 per cent of small and medium enterprises (SMEs) rejected at a pre-application stage may in fact be suitable for financing.

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