The Financial Conduct Authority (FCA) has said it will be monitoring how firms treat consumer credit borrowers as it confirmed new guidance once rules on payment deferrals end in October.
Personal loan borrowers can apply for three-month payment deferrals until 31 October and after that the City watchdog has now confirmed that firms must work with customers facing payment difficulties to offer flexible and sustainable payment arrangements.
“The FCA will monitor how firms apply the guidance to ensure borrowers are treated fairly, with regard to their individual circumstances,” the regulator said.
“Customers should be given time to consider their options and to seek debt advice, if necessary, before deciding on the support they take.”
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The FCA said support after 31 October will be reflected on credit files and firms should be clear about the implications of this.
“For those who can restart payments, it is in their best interests to do so,” Christopher Woolard (pictured), interim chief executive at the FCA, said.
“However, for those who are still facing payment difficulty, or are newly in difficulty, as a result of coronavirus, we expect firms to offer a tailored package of support taking into account the ongoing situation and local or national responses to the crisis.
“There should be no ‘one size fits all’ approach taken by firms to help consumers get back on track.”