Payday Lenders Face Debt Sympathy Inquiry
A wealth of complaints about how payday lenders and other such firms treat their customers has prompted an inquiry by the City regulator.14 March 2014
The Financial Conduct Authority (FCA), which assumes oversight responsibility for the consumer credit market on April 1, said it was making a priority of the issue because three-fifths of complaints to the Office of Fair Trading (OFT) are about how debts are collected.
The watchdog, which has previously announced a range of measures to strengthen protections for consumers, wants to investigate how sympathetic lenders are when customers struggle to pay back their debts.
It will examine the culture at each payday firm.
More than a third of payday loans - equal to 3.5 million - are repaid late or not at all annually.
The FCA said its new rules should help reduce the numbers.