Industry News

Interest rates remain unchanged

The Bank of England Monetary Policy Committee has voted to keep interest rates at 0.5% for the time being.

Fuelling speculation that an interest rate rise isn't too far away, the committee vote wasn't unanimous for the first time in months.

The debt advice sector has been bracing itself for an increase in rates following research from the Bank of England warning that hundreds of thouands of households could see their disposable incomes wiped out if higher interest rates increase debt servicing costs faster than wages can rise.

Benefits Awareness Month

As the arguments rage over the country’s finances in general and the welfare budget in particular, one fact is not in dispute: thousands of low income households do not check their entitlement to benefits.

This is Benefits Awareness Month, organised by Turn2Us which helps people in financial need find welfare benefits, charitable grants and other financial help. Their research suggests that as many as a third of households with low income could be missing out on benefits, because they simply have not checked what they could be claiming. 

"More needed to counter the ruthless marketing of loans to people who need help managing their finances” Debt Advice Foundation

Payday lenders are to be forced to make details of their loans available to price comparison websites, to encourage greater competition.  In its final report on the payday lending market, the Competition and Markets Authority says that clear comparisons will help borrowers get a better deal.

Financial sector must treat vulnerable customers with more care and understanding, says the FCA

Financial ompanies need to take greater care and to have better strategies for dealing vulnerable customers, the Financial Conduct Authority (FCA) has said.

The regulator has produced a new report designed to increase understanding and to help companies develop better ways of identifying and helping vulnerable people.  It sets out best practice, but also highlights examples of people who have not been treated fairly, even when their difficulties should have been obvious.

Steep rise in nursery costs means it can be cheaper for one parent to stay at home

Nursery fees have gone up by a third in five years , with the result that it can now be cheaper for a parent to give up work rather than pay childcare costs.

The findings come from the Family and Childcare Trust’s annual Childcare Costs Survey.  Parents now have to pay an average of £6,000 a year to send a toddler to nursery – £1,533 more than in 2010.

“Over 95 per cent of the dual fuel customers of the Six Large Energy Firms could have saved by switching tariff and/or supplier” says competition inquiry

The Competition and Markets Authority (CMA) is investigating the energy market – and its latest publication has confirmed what campaigners have been shouting from the rooftops for a long time, that if you stay loyal to one supplier you will almost certainly be paying too much for your energy.

The figures that have been published by the CMA could not be clearer.

Household debt increased “ at fastest rate for a decade” last year

Latest figures from The Money Charity show that the UK’s appetite for taking on more credit cards, personal loans and overdrafts increased dramatically in 2014.

We took on an average of just under £400 of additional consumer debt per household last year – the biggest increase since 2004. Borrowing dropped every year from 2009 to 2012.

Last year's increase contrasts sharply with 2013, when our consumer borrowing went up by just £50 from the previous year.

New compensation scheme for credit card security policies

The Financial Conduct Authority has announced a new credit card-linked compensation scheme. This one relates to card security policies, most of them under the Sentinel brand name, which were sold to customers of 11 high street banks.

One of the features of the card security products was insurance to cover fraudulent use if a card was lost or stolen. However, customers were already covered, because the card companies were mostly responsible for payments made with a stolen or lost card.

New help for people struggling with debt

The level at which people in debt can be forced into bankruptcy has been increased for the first time since 1986. The Insolvency Service has announced that the minimum amount for which someone owed money can start bankruptcy proceedings is to rise from £750 to £5000.

New rules target credit brokers treating customers “in a blatantly unfair way”

New rules designed to protect borrowers when they are looking for a short-term loan are to be introduced from 2 January 2015.

The announcement from the Financial Services Authority (FCA) has been welcomed by Debt Advice Foundation, which has campaigned for stricter controls for online credit brokers and “lead generators”.

Brokers are being targeted by the FCA because, it says, they treat customers “in a blatantly unfair way”.