On July 17th Lloyds Bank announced major changes to the way it charges for overdrafts - a massive simplification. The new charging will be introduced in November for 20 million Lloyds, Halifax and Bank of Scotland accounts. Most customers will gain. This includes three million people in old style basic bank accounts - they are winners in the new system, a group that has been badly treated by … [Read more...]
Find out what's new and what's changing in the debt world in Britain.
Persistent credit card debt – lenders must do more to help
The Financial Conduct Authority (FCA) is proposing a definition of persistent credit card debt and a set of actions credit card lenders will have to take with people who are in persistent credit card debt for 18 months or more. Recent news highlights why the FCA is worried about credit card debt. In June 2017, £67billion is owed on credit cards in Britain and that is increasing at 9% per year. … [Read more...]
Huge increase in CCJs, up to 300,000 in first quarter 2017
Registry Trust has published the statistics for CCJs for the first quarter of 2017. They are shocking, with almost 300,000 consumer CCJs, the highest number for ten years. The details are: 298,901 CCJs were registered against consumers in England and Wales from January - March 2017; this is an increase of 35% on the same quarter in 2016; the average size of a CCJ fell to … [Read more...]
Should Creditfix use the promise of early exit loans to sell IVAs?
Mr D asked: I was contacted by company called Creditfix to clear my debts in an IVA. I have about £30,000 debt (two loans, some credit cards, overdraft) and the advisor calculated my options. I was told 2 and half years of paying £150 a month, then get a £4,500 loan to pay rest. Is that ok??? * I don't know if an IVA is a good option for Mr D. He needs to decide if he can commit to the IVA … [Read more...]
Pre-Action Protocol for Debt Claims now final
In March 2017 the Pre Action Protocol for Debt was at long finalised, it's here: Debt PAP. It comes into force on 1st October 2017. It has taken many years of negotiations, consultations and delays to get here. I've asked a couple of experts for their reaction to the news. Tim Lett, who has been involved for the last four years in getting this protocol agreed, writes: I am very … [Read more...]
Who were the biggest IVA firms in 2016?
Here is the League Table for IVA firms last year, showing all firms that registered more than 500 IVAs in 2016. The data comes from the Insolvency Service, it was supplied to Louise Yates. I previously published a half-year table for 2016 - this article replaces that one now the information for the full year is available. The previous statistics for 2015 were discussed here. The up/down … [Read more...]
News snippets about high cost credit
I thought it would be interesting to bring together recent news items about various types of high cost lending in Britain. I will be keeping this page updated. Payday loans Jun 2017 FCA denies price cap is going to be increased, following an assertion by a high-cost credit broker. May 2017 Comparison Websites - payday lenders now have to advertise and link to at least one of them. A pretty … [Read more...]
FCA’s Call for Input on High Cost Credit – my thoughts
In November 2016. the FCA issued a very broad Call for Input on High Cost Credit. In November 2014 when the price cap and other payday lending rules were announced, it was stated that they would be reviewed after two years and this new Call for Input is part of that review. Andrew Bailey, Chief Executive of the FCA, said: We have come up to the point of reviewing the cap on payday lending, … [Read more...]
Insolvency numbers up – but rising debt isn’t the main cause
On 27 January the Insolvency Service published the data on insolvency in 2016. The number of people who became insolvent in England and Wales last year was 90,930. As the graph above shows, this has reversed the trend of personal insolvency numbers falling every year: the total for 2016 is over 13% higher than in 2015, the first time there has been a rise since 2009. Bank of England statistics … [Read more...]
Scarcity – why people in debt need a breathing space
I recently read Scarcity: Why having too little means so much by Sendhil Mullainathan and Eldar Shafir. Since then I have been recommending it to friends in the debt advice world. I think Scarcity is a very interesting read for anyone interested in personal debt advice and policy in Britain. Many of its arguments are directly applicable to the idea of introducing a breathing space for debt that … [Read more...]
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