The Financial Conduct Authority (FCA) have released further guidance on support for customers who are struggling to keep up with payments or make repayments.
Previous FCA guidelines are due to end tomorrow on the 31st of October, so the new support is set to apply from then.
A survey conducted by the FCA found that in the month of July 12 million adults had low financial resilience, meaning they will find it harder to cope if faced with an unexpected decrease in income or increase in expenditure. A lot of the UK’s population have seen a decrease in their income, even if just temporarily with going onto a furlough scheme, so it’s unsurprising that two of the 12 million adults with low financial resilience only became so since February 2020 when the pandemic first started impacting the UK.
The new guidance that the FCA have put in place is designed to ensure that any consumers struggling have access to tailored support which meets their individual needs, taking into account the Covid policy in their local areas as well, due to the different restrictions in place on different tiers.
Support will be available to customers who have previously taken a payment deferral and those who have not.
The FCA urge you to speak to your lender or lease finance company as soon as you realise you are going to have difficulty making payments, this is to ensure you are able to explore all potential options available to you.
Sheldon Mills, Interim Executive Director of Strategy and Competition for the FCA said: “We want to remind consumers, especially those who are newly in financial difficulty, that lenders are able to provide you with support. There are options available to you which will reflect the uncertainties and challenges that many customers will face in the coming months. It is also important that households in serious financial difficulty seek debt advice for support.”
He has also advised that firms should work with their customers and be flexible as people will be impacted in different ways by the pandemic. With this flexibility firms should consider a range of short and long term options, including:
- Suspending, reducing, waiving, or cancelling any further interest or charges
- Permitting the customer to make no or reduced payments
- Agree to a repayment plan
Full details of the guidance can be found on the FCA’s website.
Lenders are required to be clear about the credit file implications that any form of support they offer would have.
The FCA have said that consumers must be as open and transparent as possible with their lenders so they can offer appropriate support. If you can afford to continue making repayments then you are advised to do so.
If you currently have a lease through us and are concerned about making payments then you can call our Support Team on 0330 221 0000 and they will be able to direct you to the best department at your funder.
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