FCA taking action to stop payday loan hassles
The FCA have come in to tackle some blatantly unfair pricing scenes
The loan brokers have made as many as one million attempts a month to raid the bank accounts of some of the poorest members of society, who they've hoodwinked into having loans.
The payday loaners also charge a fee of around £50-75 and then will share people's bank details with up to 200 companies. Which is not on, frankly.
The financial regulator has said it had blocked seven payday loan brokers from taking on new business, with three in line for further enforcement action. Sounds sexy.
According to NatWest, they reckon they were being contacted daily in October, by vulnerable customers being hounded by extra charges.
The FCA has said new rules would come into force on 2 January 2015, and would end the lack of clear information on the websites currently luring people into paying fees they're not aware of.
The rules will ban credit brokers from charging fees to customers, and from requesting customers’ bank details unless they comply with new requirements. Transparency is key and people have to make it clear who they are dealing with, what fee will be payable, and when and how the fee will be payable.
The FCA said that over 40% of consumer credit complaints received were about credit brokers: “The FCA has also received relevant intelligence from consumer groups and others who are seeing increasing complaints from people who have had money taken from their accounts unexpectedly and often by more than one broker.”
RBS NatWest are the first bank to shade up the shady, and has terminated arrangements with 20 brokers already, but it's a slippery affair as these companies are like eels.