Aggregated News From Investment Management Regulators

FCA confirms further support for motor finance and high-cost credit customers

Report/Flag

Please complete the required fields.



Christopher Woolard, Interim Chief Executive at the FCA, said: ’Our measures will ensure that people who are still facing temporary payment difficulties because of this pandemic, continue to have access to the help they need. However, if you can afford to start making repayments, you should.’

The measures include:

  • If customers can afford to return to regular repayment, or make partial payments, it is in their best interest to do so.
  • Firms should contact customers coming to the end of a first payment freeze to find out if they can resume payments – and if so, agree a plan on how the missed payments could be repaid.
  • For customers still facing temporary payment difficulties as a result of coronavirus:
    • Firms will provide them with support by freezing or reducing payments to a level they can afford, on their motor finance, BNPL or RTO agreements for a further 3 months.
    • For BNPL customers, where a loan is within the promotional period, this will mean offering customers an additional extension to that period.
    • For pawnbroking agreements, where a loan is within the redemption period (irrespective of when the redemption period is due to end) this will mean firms offering a further extension to the redemption period. If the redemption period has already ended, this will mean agreeing not to sell the item during the payment deferral period.
  • Customers that have not yet had a payment freeze or requested an extension of an existing payment freeze can request this up until 31 October 2020.
  • HCSTC customers can only apply for a payment freeze under this guidance once up to 31 October 2020 in respect of each HCSTC agreement. For those customers who have had a payment freeze and are still experiencing payment difficulties, firms will provide a range of support – including formal forbearance – in accordance with the FCA Handbook.
  • The ban on repossessions will continue until 31 October 2020 – this applies to motor finance and RTO customers still facing temporary payment difficulties as a result of coronavirus and who need their vehicles or goods.
  • Where a customer needs further temporary support to bridge the crisis, any payment freezes or partial payment freezes offered under this guidance should not have a negative impact on credit files. However, consumers should remember that credit files aren’t the only source of information which lenders can use to assess creditworthiness.

When implementing this guidance, firms should be particularly aware of the needs of their vulnerable customers and should consider how they engage with them. Firms should also help customers understand the types of debt help and money guidance that are available and encourage them to access the resources that can help them.

The guidance comes into force on 17 July 2020.

Notes to editors

  1. Motor finance agreements and coronavirus: updated temporary guidance for firms
  2. High-cost short-term credit agreements and coronavirus: updated temporary guidance for firms
  3. Rent-to-own, buy-now pay-later and pawnbroking agreements and coronavirus: updated temporary guidance for firms
  4. FS20/11: Further support for consumers impacted by coronavirus: feedback on draft guidance and rules
  5. Consumer page on dealing with financial difficulties during coronavirus
  6. Information for consumers on personal loans, credit cards, overdrafts, motor finance and other forms of credit

Source link

Regulator Information

Regulator Name: Financial Conduct Authority
Abbreviation: FCA
Jurisdiction: United Kingdom

Recent Articles

Renee Jones to Join SEC as Director of Corporation Finance; John Coates Named SEC General Counsel

The Securities and Exchange Commission today announced that Renee Jones has been appointed Director of the Division of Corporation Finance.

SEC Awards Approximately $3 Million to Two Whistleblowers

The Securities and Exchange Commission today announced an aggregate award of approximately $3 million to two whistleblowers whose information and assistance led to a successful SEC enforcement action

Havilland Bank (clone of FCA authorised firm)

Fraudsters are using the details of firms we authorise to try to convince people that they work for a genuine, authorised firm. Find out...

Wittan Invest / Wittan Investment Trust Service (Clone of FCA authorised firm)

Fraudsters are using the details of firms we authorise to try to convince people that they work for a genuine, authorised firm. Find out...

Circular 04/2018 (VA) – Financial Conglomerate Solvency

You have the option below to allow a unique web analytics cookie to be stored on your browser, enabling the operator of the website to collect and analyse various types of statistical data.

Get the latest from Regulatory.News in your inbox!

×