This is a guest post by Nick Lord. It argues that the new pension rules are a game-changer for debt advisers and that debt advice agencies need to put measures in place to ensure that their advisers can provide best advice post April 2015. Nick is a consultant on money advice and personal finance issues working with Government departments, regulators and firms. His past posts include senior Money … [Read more...]
Debt news and policy
Debt Camel articles on what's happening in the world of personal debt in Britain.
For my collections of other news items, please see Weekly News Summaries.
The FCA announced on the 11th November that it will cap the costs of payday loans from 2nd January 2015: Initial cost cap of 0.8% per day. For new loans, or loans rolled over, interest and fees must not exceed 0.8% of the amount borrowed. So for a one month loan of £100, the interest and fees if the loan is repaid on time cannot exceed £24 If borrowers cannot repay their loans on time, … [Read more...]
On 2nd October 2014 the Financial Conduct Authority (FCA) announced that Wonga had agreed to compensate an estimated 375,000 customers where Wonga's "affordability" checks are likely to have been inadequate. The common reactions were first that Wonga was being made an example of to warn other payday lenders and second that this was a huge number of clients... But is this a fair approach by the … [Read more...]
The Debt Counsellors Charitable Trust (TDC) is an interesting addition to the free debt advice sector. TDC is a charity which provides telephone-based debt advice and debt management solutions to anyone living in England and Wales. It has been funded initially by a significant donation from The Emanuel Trust. TDC's official launch will be on 14th Oct but it is taking cases now either via its … [Read more...]
In September 2014, the Financial Conduct Authority (FCA), which had became the regulator for debt management firms in April, issued a press release warning debt management firms, payday lenders and credit brokers that: "Many firms are falling well short of our expectations and they will need to raise their game if they want to continue operating." Many of these firms currently only have … [Read more...]
The guidelines for the inclusion of council tax debts in the three different forms of personal insolvency in England and Wales - bankruptcy, Individual Voluntary Arrangements (IVAs) and Debt Relief Orders (DROs) have changed in 2014. This has happened following the judgment in Kaye v South Oxfordshire District Council that business rates for the current tax year should be included as a debt … [Read more...]
The IVA Standing Protocol Committee meets about three times a year. Part of the committee's remit is to identify problems/issues arising in the operation of the Protocol at an early stage. I understand that the CAB's representative on the standing committee raised the issue of secured loans at their July meeting but no amendments were considered necessary by the majority of the … [Read more...]
In August 2014, the Insolvency Service issued a Consultation on Debt Relief Orders (DROs) and Bankruptcy petition limits. I think there are a lot of problems with the personal insolvency regime in England and Wales (see my article last week about the recent insolvency statistics) and so this consultation provides a welcome opportunity for the Insolvency Service to get industry responses on many … [Read more...]
This week the insolvency statistics for April-June 2014 were published. Company insolvencies dropped 15% on the same time last year - good news as fewer people will have lost their jobs. However personal insolvency numbers were up 5% and the breakdown by the type of insolvency varied significantly: IVAs were up a huge 20% bankruptcies down 16% Debt Relief Orders (DROs) down 2%. Are … [Read more...]
It is expected that the Financial Conduct Authority (FCA) will make an announcement in June 2014 on capping the costs of high-interest, short term credit usually known as payday loans. It isn't clear if this will be a single proposed measure or a range of options leading to further industry consultation. Last November, the FCA was given a duty in the Banking Reform Bill to introduce a cap on … [Read more...]