Thousands of people are marching in Italy as the European Central Bank holds its monthly meetingLatest: Protests in ItalySummary: MPs demand answers from Wonga 2.05pm BST Good question on the economy of #Italy and its problems to which #Draghi replies "Blame the govt. not me!" #ECB 2.05pm BST Draghi clearly not planning to open a shop 2.04pm BST What kind of structural reforms are needed?Mario Draghi takes a swipe at red tape, citing the example of someone who wants to open a new shop but is forced to apply for various permissions. 2.02pm BST Q: Do Mario Draghis comments about governments needing to do more mean he is running out of instruments?Theres no grand bargain here, Draghi insists.There is no bargain here. Each actor has its role to perform 2.01pm BST Q: By how much does the ECB want to expand its balance sheet (it has cited 2012 levels, but it varied during that year):Mario Draghi says he understands why we want a precise number. But hes not going to provide one! Our mandate is to get inflation back to just below 2% - thats how well measure success, he says. 1.58pm BST Draghi: A prolonged period of too low inflation is harmful and that's why the measures were taken. 1.57pm BST Next question, does the ECB think that inflation expectations are still well-anchored?We dont use one measure, Draghi replies, we use a range. 1.55pm BST First question: can we have more details about the ABS programme please, and will it allow the ECB to bundles of Greek and Cypriot bank loans with Junk ratings?Draghi: Youll get full details after the press conference. Its hard to give a precise figure because the programme is tied up with other ECB programmes (such as the new TLTRO loan offer).Draghi: dumping lower limit on credit rating for ABS purchases. But adds conditionality - keeps Greece and Cyprus in#Draghi: countries with lower rating ought to have on-going programme with the EU 1.54pm BST Mario Draghi is now taking questions (that was a quicker statement than usual). 1.48pm BST European countries must not let progress unravel, and should stick to the pact on growth and stability, says Draghi.Thats a signal to France, I feel, which isnt planning to hit its 3% deficit target until 2017, several years late.The unelected #Draghi is now lecturing elected politicians about fiscal policy #Euro #ECB 1.46pm BST *DRAGHI SAYS ECB TO CLOSELY MONITOR MEDIUM-TERM INFLATION RISKS - no mention of balance 1.46pm BST Credit supply growth also remains weak, says the ECB president.Not much cheer in todays statement! 1.45pm BST Draghi also gives politicians a nudge, saying that insufficient reform progress is another downward risk. 1.44pm BST The ECB appears to have changed its language on inflation expectations....#Draghi admits that inflationary expectations are no longer firmly anchored: at long last! 1.44pm BST Recent data confirms that the growth momentum is weakening, says Draghi. 1.43pm BST On economic conditions, Draghi warns that risks remain to the downside. Inflation is subdued (it hit a five-year low of just 0.3% last month), and unemployment is still too high (at 11.5% in August) 1.42pm BST Mario Draghi says the ECB governing council unanimous on the use of additional unconventional measures if necessary -- a signal that a full-blown sovereign bond-buying QE programme is still possible. 1.41pm BST #Draghi: taking into account overall subdued outlook for inflation, weaking growth momentum, our ABS purchases should ease mon pol stance 1.41pm BST Important -- we are getting details of the ECBs new QE-style stimulus programme (which was agreed in principle last month)The covered bond operation will start in October, Draghi says. 1.38pm BST Mario Draghi begins reading his statement -- confirming that the ECB left interest rates unchanged.The ECB has also agreed on the key operational details of its new asset purchase programme, and covered bonds (announced last month). 1.37pm BST The ECB press conference is underway, after that slight delay.... (livefeed here) 1.35pm BST Mario Draghis late!Where's Draghi? 1.31pm BST Another photo from Naples -- an anti-austerity protester dressed as Saint Gennaro (Januarius, Naples saint patron) taking part in a demonstration on the sidelines of the Governing Council of the European Central Bank meeting. 1.25pm BST OK, its nearly time for the European Central Banks press conference from Naples.Mario Draghi is expected to outline the asset purchase scheme announced (despite German opposition) last month. 1.21pm BST Reuters reports that the Italian police say there were around 600 protests on the streets of Naples, fewer than the demonstrators estimated earlier (scroll back to 12.11pm BST for our report): 1.02pm BST Two or three years ago, the anti-austerity protests that are gripping Naples today were a regular feature of the eurozone landscape. 1.00pm BST Heres a snap of the ECB governing council meeting in Naples, where they voted to leave rates unchanged: 12.54pm BST #napoli #blockbce People wearing Pulcinella's mask protest in Neaples pic.twitter.com/Q1dD9jguIS 12.49pm BST Away from the protests, the ECBs governing council has voted to leave interest rates unchanged. Thats not a surprise at all.Rate Decision: @ecb - no change 12.42pm BST Todays demonstrators are using the #blockbce hashtag to co-ordinate on Twitter#blockbce Vertice Bce a Napoli, idranti in azione e cariche contro i manifestanti http://t.co/sabKmnJDrw pic.twitter.com/8rKHijWD8ZTantissimi applausi al corteo che attraversa il quartiere popolare Sanità . #blockbce #napoli pic.twitter.com/JuuTC9aV0YNel rione Sanità #napoli #blockbce pic.twitter.com/ZGTBLxSEqW 12.40pm BST This man carried a placard declaring: #Block BCE (ECB) Well be inflexible, at todays protests in Naples. 12.35pm BST And heres a demonstrator wearing a mask during todays protest against the ECB. 12.29pm BST Heres another photo from Naples, of an Italian policeman with a camera on his uniform at todays protests: 12.17pm BST The demonstrators in Naples were ready for Mario Draghi and the governing council, as this poster shows:ECB go away: streets in Naples today eerily empty, no cars, as city gets ready for protests against Draghi & co. pic.twitter.com/NRd7qU6YzR 12.17pm BST Theres a live video-feed showing the protests in Naples here (right-click to open in new tab) 12.11pm BST Over in Naples, thousands of demonstrators are marching as the European Central Bank holds its monthly monetary policy meeting.Today all Italians should stage a protest as the start of a season of struggle. All Europeans must say: basta[enough]. Water canons & tear gas not stopping #Blockbce protests in #Naples during European Central Bank mtg. pic.twitter.com/8REoEa5DbT via @SpazioMetiA huge climate of fear has been built up around this protest. Weve been obliged in recent days to explain that it is the young people of this city who are protesting, young people who want to have a future.Protesters clash with police in Naples, where #ECB meets. Banner says: "Let's get rid of ECB" (h/t @fattoquotidiano) pic.twitter.com/l1wBN9sEIU 11.59am BST While Wonga was dominating our attention, the Bank of England was revealing that it wants more controls to help steer the UKs housing market.Its Financial Policy Committee has asked chancellor George Osborne for the legal power to cap the value of loans to homeowners related to the value of a property, and borrowers income.Bank of England asks for powers to intervene in housing market http://t.co/K3XGFvZcPM 11.36am BST MPs have called for Wonga to be hauled before parliament for questioning, after the Financial Services Authority forced the payday lender to make major changes to its service and stop lending money to people who cant afford to pay it back.John Mann tells me he wants Wonga recalled to the treasury select committee urgently.John Mann: Wonga have used "underhand tactics" to "target vulnerable people" and said action should be taken against ex-CEO Errol DamelinWe are determined to drive up standards in the consumer credit market and it is disappointing that some firms still have a way to go to meet our expectations. This should put the rest of the industry on notice they need to lend affordably and responsibly.There is much to do in order to make Wonga a sustainable and accepted business, and todays announcement is a significant step forward in that process.Wonga new CEO tells me the company lent to people we should not have lent to and are "taking actions to address the failings of the past"#Wonga lent £1.3 bn last year and is now writing off debts of £220 million. Guess its "algorithm" wasn't sophisticated after all. 11.22am BST Cathy Jamieson MP, Labours Shadow Financial Secretary to the Treasury, has welcomed the FCAs move to drive up standards in the payday loans industry.But she also argues that payday lenders should be hit with a levy, with the proceeds used to fund credit unions:It is right that Wonga, in agreement with the FCA, has taken action to help customers affected and strengthened their lending and affordability criteria.We believe that more should be done. A Labour Government will extend the levy on the profits of payday lenders and use the additional money to double the level of Government funding for credit unions. 11.14am BST MPs on the Business, Innovation and Skills committee did quiz Wonga last November, as part of an inquiry into the payday loan sector.Wonga defended itself robustly at the time. Chief operating officer, Niall Wass, declared in an interview that:I am not sitting here today saying that everything we do is perfect; what we are trying to do is use great technology to give a really fair, transparent service to customers. 11.08am BST John Mann MP, another member of the Treasury Committee, has declared that Wonga should be recalled to parliament to explain what went so badly wrong.Speaking to my colleague Rupert Neate, Mann said Wonga has used underhand tactics to lend to these 330,000 people whose debts are now being wiped away.John Mann tells me he wants Wonga recalled to the treasury select committee urgently.John Mann: Wonga have used "underhand tactics" to "target vulnerable people" and said action should be taken against ex-CEO Errol Damelin 10.59am BST Carl Packman, who has written two books on the payday lending industry, points out that Wongas much-vaunted software failed to live up to its claims.He says:Wonga has always been able to hide behind the excuse that it is an innovative tech company before its a payday lender, but they are admitting today that their algorithm hasnt stopped the company from lending to those people who are least able to afford high cost credit.The problem with payday lenders is that for so long they have been motivated to lend money without carrying out affordability assessments because this is what draws a profit. Not carrying out credit checks saves the firms money and if borrowers are struggling to pay off their loans then lenders can cash in on rollover options. 10.54am BST David Mann, head of Money at uSwitch.com, says Wongas new affordability rules are a great victory for consumers, but they dont fix the wider issue of why customers were put in this vulnerable position in the first place.The new affordability criteria put in place by Wonga goes some way to address these questions as payday lenders need to have the same controls in place as banks and building societies before issuing credit.Todays news doesnt solve the escalating need for short term loans. Those most in need of money, often with poor credit ratings, have been turned away from the banks and left to feel they have no other option. There is a bigger question that needs to be asked around the growing need for short term credit. 10.26am BST Labour MP Pat McFadden has told the BBC that Wonga could be called to the Treasury Committee (hes a member) to explain todays changes.Pat McFadden tells me he wants to recall Wonga to give evidence to Treasury Select Committee - has their business model changed? 10.19am BST 330k loans is possibly about 7% of all loans based on their YE 2013 number of loans (4.6m) #WongaRemember Wonga's "world class" algorithms? It's website that could decide in seconds if you were able to repay a loan. Where's Errol?Wonga will be contacting all customers by 10 October to notify them if they will be included in the payback 10.03am BST Is Wonga doing the right thing, or is it rewarding people for reckless borrowing? Vote here: 10.01am BST It would be a mistake to think that Wonga are doing this out of the goodness of their heart. Its clear that these loans arent compatible with the new lending criteria agreed with the FCA, and therefore shouldnt have been made in the first place. Would suggest they woule be unenforceable under new rules - Wonga to write off debts of 330k customers http://t.co/gYJS9OcrKL via @meganmurp 9.57am BST Wonga sources are briefing that the actual cost of writing off all these loans is £35m.Thats almost double the £18.8m wiped out in remediation costs after it sent fake lawyers letters to customers in arrears.Wonga is writing off £220 million owed to it but final loss to company only £35 million. Tells you something about interest it charged.Payday lender Wonga says it will write off the debts of 330,000 customers, at a cost of £35m http://t.co/1NlVS1iyTW pic.twitter.com/Eb0ZaHqjYA 9.46am BST The total value of the debt being written off is £220m, or around £667 for each of the 330,000 Wonga customers whose debts are being written off.Of course, we dont know how much they initially borrowed....#Wonga to write off debts of 330,000 customers. Loans worth a total of £220m. That's around £667 per customer 9.42am BST Heres the full statement from the Financial Conduct Authority, outlining how Wonga has now entered a voluntary requirement (VREQ).When it took over regulation of consumer credit in April of this year, the FCA requested information about the volume of Wongas relending rates. The information received suggested that Wonga was not taking adequate steps to assess customers ability to meet repayments in a sustainable manner.Press release: Wonga to make major changes to affordability criteria following discussions with the FCA http://t.co/XPj1uEQnut 9.31am BST Another staggering fact is that there are a third of a million people in the UK who have taken out loans with Wonga that they simply cannot pay back.Blimey - Wonga writing off debts of more than THREE HUNDRED THOUSAND people who can't afford to pay back ....FCA press release suggests Wonga move much less its decision than the firm's release paints it! 9.30am BST The BBCs Kamal Ahmed reports that Wonga is writing off £220m of debt (which it now admits it shouldnt have loaned in the first place).Wonga has announced it is writing off £220m of debts for 330,000 customers who wouldn't have got loans under new, tighter lending rules 9.29am BST Wongas shock decision to write off the debts of 330,00 customers is part of a deal with the Financial Conduct Authority, designed to clean up the payday lending industry.Clive Adamson, director of supervision, has declared:We are determined to drive up standards in the consumer credit market and it is disappointing that some firms still have a way to go to meet our expectations. This should put the rest of the industry on notice they need to lend affordably and responsibly.It is absolutely right that Wongas new management team has acted quickly to put things right for their customers after these issues were raised by the FCA. 9.24am BST Big news breaking in the UK. Wonga, the payday lender, has just announced that it is writing off all outstanding debt on 330,000 customers who are at least 30 days late in their repayments.And a further 45,000 customers who are in arrears of up to 29 days will be asked to repay their debt without interest and charges. Theyll also be allowed to repay their debt over an extended period of four months.Its clear to me that the need for change at Wonga is real and urgent. Our regulator is determined to improve standards in consumer credit and I share that determination. There is much to do in order to make Wonga a sustainable and accepted business, and todays announcement is a significant step forward in that process. 9.05am BST Mario Draghi set the scene for todays ECB meeting in Naples last night, by declaring that the central bank faces a Herculean task.As policymakers in Italy and in the euro area, it often feels like we face a Herculean task to revive growth and bring down unemployment.And just like Hercules confronting the Hydra, it sometimes seems as though just as we defeat one challenge, such as the sovereign debt crisis, two new challenges spring up, such as low inflation and a weak recovery.Monetary policy can play a role here by lowering the cost of capital. But investment also depends on certainty over public finances. And lower interest rates will not encourage firms to borrow to invest if their returns are reduced by rising taxes, or eaten away by hidden costs linked to unnecessary regulations. Thus, fiscal and structural policies must also do their part. 8.53am BST Nearly every Q to @PierreMoscovici on #France budget failures. "Let's not only talk about 1 country," he pleads, to no avail #EPhearings2014 8.48am BST Over in Brussels, former French finance minister Pierre Moscovici is being grilled by the European Parliament over his appointment as a new economy commissioner.Moscovici is promising that he will apply the EUs budget rules to his home country -- which yesterday declared that it would not hit its deficit target until 2017, two years late.Former French Min Moscovici tells his confirmation hearing that he will apply budget rules to France: 'Only the rules will be my compass'#Moscovici: We have our rules, they need to be credible and they're there to be respected. They're intelligent, not stupid. #EPhearings2014The @PierreMoscovici hearing gets off to v partisan start. Tough Qs from centre-right applauded; applause for Mosco answers on centre-left#EPhearings2014 pierre 'last chance europe' moscovici told he's a failure 8.42am BST Europes stock markets have begun where they left off yesterday, with losses across the board.Its a fairly subdued selloff, with the FTSE 100 dropping another 26 points or 0.4% to 6529, having hit a five-month low last night.Markets like watching the drunk guy and knowing he is going to fall down. 8.34am BST A quick-round up of the other early morning news.Pizza supplier Dominos has reported strong sales again, with underlying turnover in the last 13 weeks jumping by 12.9%. Its mobile app, and a new website, are luring customers in. However, Germany remains a problem -- sales are down 9.9%. Investors are pleased - shares have jumped 2% in early trading. 8.23am BST Its been a good morning for staff at Virgin Money, one of the UKs new challenger retail banks.Virgin Money announced that it plans to raise £150m by floating on the stock market. And each employee will receive £1000 of free shares too.Trebles all round at Virgin Money ... "each employee will be awarded £1,000 worth of shares in the business upon flotation."I am pleased we have reached the point where Virgin Money is ready to start life as a listed company. We have built a safe, sound and secure bank supported by a strong Board. The Company has an extremely positive future and I am delighted the business is in such a good position. 8.00am BST Good morning, and welcome to our rolling coverage of the financial markets, the world economy, business and finance.Theres a real sense of nervousness in the financial markets today, after a heavy selloff on Wall Street last night.Europe gets set for lower open this morning after a sharp sell-off on Wall Street overnight exacerbated fears that we could be about to embark on the long feared global equity market sell-off, after a five year bull market rally.With the Federal Reserve set to end its QE program this month and economic data deteriorating globally, particularly in Europe the concern is whatever the ECB [European Central Bank] does wont be anywhere near enough to fill the gap left by the US central bank, against an uncertain geopolitical back drop and a slowing world economy.@ITVJoel: Virgin Money (the bank formerly known as Northern Rock) confirms its intention to list on London Stock Exchange. 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