We have welcomed the measures the Financial Conduct Authority (FCA) has taken to date to support consumers affected by coronavirus. However, these measures have deferred repayment difficulty for many people and problems are building up.
Our polling shows that large numbers of people whose income has been negatively affected by coronavirus have built up arrears and debt since the beginning of social distancing measures in the UK.
This response sets out advice for the FCA on ongoing support for those affected by coronavirus. This includes:
- Extending the flexibility for firms to provide payment deferrals beyond October 31 and considering the flexibility to extend the length of deferrals beyond six months
- Preventing negative credit reporting from deterring consumers from seeking help or disadvantaging those who access payment deferrals in future
- Strengthening forbearance guidance to deliver a reduction in repayment burdens, unduly escalating debt balances protection and enforcement action
- Ensuring that any streamlined support from firms for customers exiting payment holidays is effective and works for those who are most vulnerable
- Ensuring free independent debt advice capacity is used as far as possible to deliver high quality advice and support to those with multiple arrears and debts
- Preventing a new cohort of people falling into persistent credit card debt or repeat overdraft use due to coronavirus
You can download our full response here.