“The FCA needs to ensure that consumers are properly protected and our concern is that these proposals don’t go far enough. Credit card debts remain the biggest single category of problem debt for our clients, with average debts of over £8,000.
“We welcome moves to tackle persistent debt, but we are concerned that these proposals will not fix the central issue that credit cards, which are supposed to be a short-term form of borrowing, often become long-term and expensive debt.
“The proposals do not address the fundamental question of how credit cards trap people in persistent debt. These measures will still potentially leave people paying back substantial amounts over extended periods of time.
“Our clients tell us that unsolicited credit card limit increases are linked to deepening debt problems. The Bank of England is looking at lending standards and the FCA should have sent a clear message to firms that credit should be bought and not sold by banning all unsolicited credit limit increases. New protections have only been introduced for new credit cards when they should exist for all accounts.
“Two key questions remain. How will these proposals help prevent people from falling into persistent debt? And will these interventions do enough to get people out of long-term debt?”