Excerpts from BBC article on “Credit card interests at new high“
source: http://news.bbc.co.uk/2/hi/business/8517738.stm- Financial information service said that the average interest rate in February 2010 has risen to 18.8%, while the Bank rate remains at 0.5%.
- According to Bank’s figures the bad debt write-offs doubled to £1.6bn in the third quarter of 2009.
- Government has proposals to stop card firms from changing interest rates on existing debts and to increase the minimum amount to be paid off each month.
Consumer Credit Act
The Consumer Credit Act 1974 requires most businesses that offer goods or services on credit or lend money to consumers to be licensed by the OFT. Trading without a licensing arrangement is a criminal offence and can result in a fine and/or imprisonment.
source: http://www.oft.gov.uk
Tit Bits on UK Lending Industry
1. In UK 4.2 million people use basic bank account facilities which do not include an extended credit service.
source: mirror
2. Britain’s top rate of income tax is set to rise to 50 % from 40 % in April. The government has also introduced a one-off 50 % levy on banking sector bonuses that exceed 25,000 pounds.
source : reuters
Excerpts from BBC article on “Payday loans booming in the recession“
source: http://news.bbc.co.uk/2/hi/business/8402393.stm- New European regulations to be enacted in June 2010 may make cross-border lending easier.
- According to an interim report by the Office of Fair Trading (OFT), there is a heavy rise in Competition in 2009, into the £35bn high-cost credit market.
- John Lamidey, of the Consumer Finance Association trade body, says that the increased competition has come from existing lenders or pawnbrokers moving into the payday market together with brokers and introducers, rather than a herd of new entrants.
- The OFT report says. “Credit unions have not achieved a significant presence in the UK,” the membership rate in England is 0.9%, in Wales it is 1.8% and in Scotland it is 5.6% of the population.
