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The Analysis Editor’s Letter

Industry ‘pushing back’ against tide of regulation

Stephen Kiely Editor CCR Magazine

Welcome to February’s edition of CCR Magazine. ‘Pushing back’ is one of those somewhat

crass phrases that tend to litter today’s business world but, interestingly, in relation to the credit and collections industry, it is one that we are starting to hear more and more. Specifically, we hear it in the context of

regulation, which many in the industry believe to have become overly intrusive, bringing negative outcomes for both industry professionals and their customers. Last month, for example, in CCR Magazine,

experienced industry professional Eddie Pacey wrote an article (‘A debtor by any other name’, p50) which has already received several positive responses, arguing that the modern vogue of calling someone in debt a ‘customer’ rather than a ‘debtor’ does not actually help them. Then, responding to the Financial

as ensuring that the rules on mortgage sales and advice are fit for purpose in a digital age.” Likewise, the Credit Services Association

was keen to encourage members to make their voices heard during the Ministry of Justice’s (MoJ) consultation on the Pre-Action Protocol (PAP). President Leigh Berkley insisted that a separate PAP for debt claims was “completely unnecessary, especially since 90% of claims issued go uncontested”. He added: “As the proposal currently

Conduct Authority’s ‘call for inputs’ on competition in the mortgage market, Paul Smee, director general of the Council of Mortgage Lenders, was not afraid to give an honest opinion: “Overall, we think the UK mortgage market is actually very competitive. Yet, in recent years, lenders have had to focus a lot of their resources on implementing the changes flowing from new regulation. To help the market grow in competitive terms from here, it needs a period without too much further regulatory intervention. “That said, there are some areas where modest deregulation – or,

at least, permissive clarity from regulators on areas where taking a liberal interpretation currently feels like a risk to lenders – might help. Examples include the rules on assessing affordability when lending to borrowers whose loans will extend into retirement, as well

February 2016

To help the market grow in competitive terms from here, it needs a period without too much further regulatory intervention

stands, PAP is onerous, costly, and potentially detrimental to customers, repeating actions and providing documents already available to the customer throughout the collections process. We have argued that a better use of time would be to provide customers with clear information about what they can expect from the court process. “Consumers, in the vast majority of cases,

will have already received this information if they needed copies, and whilst the reply form attempts to reduce the amount of paperwork, it is likely that some consumers will simply ask for all the listed items.” Mr Berkley said that, despite their strong

representations and those of other interested parties, the MoJ appeared keen to drive the PAP for debt claims forward. The trend, in short, is clear: everyone in the industry understands

that proper regulation is required, but this needs to be proportionate, informed, and well-reasoned. And, for this to be the case, the regulators need the industry to have their say. Let us hope that 2016 becomes the year when the industry

rediscovers its right to ‘push back’. Enjoy the magazine! 3

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