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Uswitch comments on FCA review of high-cost credit

Commenting on the Financial Conduct Authority’s announcement that it is looking for further evidence to continue its review of high-cost credit, including the impact of the payday loan price cap, Richard Neudegg, head of regulation at Uswitch.com says: “The introduction of the payday loan price cap in January 2015 was a significant step forward in helping to protect thousands of vulnerable consumers from falling into a debt spiral and it is encouraging that the FCA is to investigate its impact.

“However, more work is required to ensure people drawn to short term credit are better informed of all the options available to them, as well as improving their understanding of the repayments they will incur and the risks to their credit file should they fail to meet them.

“Fees for arranged overdrafts remain a law unto themselves – and can be more expensive than spending on a credit card or taking out a loan. It is made all the harder for consumers as it’s notoriously difficult to understand what overdrafts actually cost. This is partly because the charges used by different banks vary but also because people don’t know how long or how much of their overdraft they’ll need each month.

“Given that millions of people rely on their overdraft every month just to make ends meet, we urge the FCA to look closely at the stealthy fees being imposed by the banks.”

Find out how you could save over £1,000 a year with Uswitch here.

FOR MORE INFORMATION

Rory Stoves
Phone: 020 3872 5613
Email: rory.stoves@uswitch.com
Twitter: @UswitchPR

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Uswitch is the UK’s top comparison website for home services switching. Launched in September 2000, we help consumers save money on their gas, electricity, broadband, mobile, TV, and financial services products and get more of what matters to them. Last year we saved consumers over £373 million on their energy bills alone.

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