LONDON (Reuters) - Britain's government said on Monday it will fund a crackdown on loan sharks through a levy on thousands of consumer credit firms.
Curbs on payday lenders were introduced in January last year, a step regulators had said could propel people into the arms of loan sharks.
The finance ministry said a law going through parliament will be amended to give the Financial Conduct Authority (FCA) powers to introduce a new levy to fund enforcement action against illegal money lending across Britain.
FCA teams in England and Wales have already prosecuted more than 300 illegal money lenders, written off over 50 million pounds of illegal debt, and helped over 20,000 consumers, the ministry said in a statement.
Funding for the teams will be kept at the same level until the levy is introduced in the 2017/18 financial year.
The FCA was given powers in April 2014 to begin regulating Britain's 50,000 consumer credit firms.
"Illegal money lenders prey on some of the most vulnerable people in society, causing their victims immense misery," Harriett Baldwin, a junior finance minister, said.
Reporting by Huw Jones, editing by Louise Heavens