In Focus Collections


Credit where it is due


Considering the main changes and highlights of the Financial Conduct Authority’s new rules for the credit-card market


Glen Walker Chief compliance officer, Ascent Glen.Walker@ascent.co.uk


The Financial Conduct Authority’s (FCA) new rules for the credit-card market came into force on 1 March 2018, but providers have until 1 September 2018 to comply, with the changes providing more protection for credit-card customers in persistent debt, or at risk of financial difficulties. This brings the FCA’s approach closer to


the way in which it regulates mortgages – another area in which we are well established.


Comprehensive study The changes are being introduced following a comprehensive study of the credit-card market. The study analysed the accounts of 34 million credit-card customers over a


period of five years, and surveyed almost 40,000 consumers. The aim now is to significantly reduce


the numbers of customers with problem credit-card debt, particularly by helping them to make headway against the outstanding balance. The FCA has summarised its approach


by saying “under these new rules, firms will have to help customers to break the cycle of persistent debt, and ensure customers, who cannot afford to repay more quickly, are given help”. The regulator does acknowledge, helpfully,


that the flexible nature of credit cards is one of the most positive features about them, valued by millions of consumers.


The regulator does acknowledge, helpfully, that the flexible nature of credit cards is one of the most positive features about them, valued by millions of consumers


Figures show that around 4 million


customers are in persistent debt, paying on average around £2.50 in interest and charges for every £1 that they repay of their borrowing.


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www.CCRMagazine.com


April 2018


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