New UK Credit Regulations

UK announces new regulator to control payday loan sectorThe United Kingdom government has just announced plans for greater controls on credit providers – with a clear focus on the “payday loans” market.

This comes after a detailed investigation on the sector by the Office of Fair Trading, with government ministers declaring that not enough has been done to protect the public from exploitative lenders.

It has gone as far as creating a new regulator to handle the matter – the Financial Conduct Authority (FCA) – which will take control on this from the Office of Fair Trading in the second quarter of 2014. The FCA will have considerable power to regulate the industry, being able to issue unlimited fines and ban particular products/services from the market.

One of the conclusions of the Office of Fair Trading investigation was that lenders were not making clear the real cost of repaying payday loans, and also that many of them were making loans to people who were not in a position to repay them.

For more details please visit the Which Magazine website.

Philip