We aim to make our website as accessible as possible. However if you use a screen reader and require debt advice you may find it easier to phone us instead. Our phone number is 0 8 0 0 1 3 8 1 1 1 1. Freephone (including all mobiles).
StepChange Debt Charity logo

Free advice on problem debt
based on what's best for you

0800 138 1111 Freephone (including all mobiles)

Our response to FCA call for input on high-cost credit and overdrafts

29 November, 2016

In response to the Financial Conduct Authority’s (FCA) call for input on high-cost credit and overdrafts, Mike O’Connor, Chief Executive, said:

“Today’s announcement is a welcome one. High-cost short term credit (HCSTC) products are used by people who are often financially vulnerable. The cost and design of these products can trap people in cycles of repeat borrowing which deepens their financial difficulties. Every day our advisers see people who are damaged by these products.

“The review of payday loans is timely, and we think further FCA intervention is necessary to address the problems that still exist in the market, including lenders moving from traditional payday loans to instalment loans, the continued problems caused by people accessing multiple loans, and the poor treatment of customers. But let’s not forget that this marketis selling to people who lack other options. The Government must support financially vulnerable through the provision of better alternatives to HCSTC.

“I welcome the fact that the FCA has now acknowledged that overdrafts can act as a form of high-cost credit, and this review gives the FCA an opportunity to examine the case for a cap on unarranged overdraft fees. The need for caps in other markets has already been accepted, as with payday loans and credit cards. There is ongoing consumer detriment from overdraft fees. Unnecessary delays in action risks further harm to financially vulnerable consumers."

Notes to Editors

1. Payday loans: the next generation (PDF) - StepChange Debt Charity report – November 2016

StepChange Debt Charity News Contact

Contact the StepChange news team on:

Tel: 0207 391 4598

Mobile: 07985 404 153

Email: press@stepchange.org

Follow our press team on Twitter: @StepChange

Helping you become debt free...

“I wish to thank your staff for all the great help they gave me when I was in so much debt.
They were a pillar of support to me.” (Leslie, Essex)

Foundation for Credit Counselling Wade House, Merrion Centre, Leeds, LS2 8NG trading as StepChange Debt Charity and StepChange Debt Charity Scotland. A registered charity no.1016630 and SC046263. It is a limited company registered in England and Wales (company no:2757055). Authorised and regulated by the Financial Conduct Authority.

*This is the average rating of our service based on the StepChange reviews on Feefo by DMP and DRO clients three months into their solution.

© StepChange Debt Charity 2016