FCA vows to help borrowers through the cost-of living crisis
The City regulator is focused on supporting borrowers and consumers through the cost of living crisis.
Speaking at the Credit Summit 2022, Brian Corr, interim director of retail lending at the Financial Conduct Authority (FCA), said as inflation rises, the watchdog is working to ensure that borrowers get support when they enter into financial difficulty and to help people with limited borrowing options.
Corr said consumers are “facing significant pressure from the rising cost of living” so credit matters greatly to them.
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He added that the regulator is working on delivering the right outcomes for consumers who use credit products, and wants firms to do the same, with the FCA’s new consumer duty expected to play a big part in this.
Corr said that the UK needs credit markets that are innovative, competitive and focused on their customers’ needs and that it is vital that the FCA maintains constructive dialogue between regulators, industry, consumer groups and debt advisors, as the economic situation changes.
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He said that some consumers have limited borrowing options and either cannot borrow, or their “fragile circumstances” make using credit risky.
The FCA is “thinking carefully” about how to help those who have historically been limited to high-cost credit options following recent changes in the market, Corr added.
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“People across the country are facing significant pressure from the rising cost of living,” Corr said.
“We’re still processing the effects of previous seismic events like Brexit and the coronavirus pandemic, as the implications of the war in Ukraine start to impact the UK economy.
“Just as we and the credit industry acted swiftly and successfully to help shield consumers in the emergency phase of the pandemic, we need to respond again to these new circumstances – and be ready for future challenges when they come.
“For us, that means continuing to sharpen our focus on the outcomes consumers get from credit markets, underpinned by our more adaptive, more assertive, and more innovative regulatory approach.”
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