The Citizens Advice Bureau (CAB) has hailed credit reforms announced today that will attempt to clamp down on irresponsible lending.
CAB is on the sharp end of the debt industry, fielding over a million queries over problem debt every year.
It has warmly greeted an amendment to the Consumer Credit Bill which will add “irresponsible lending” to the list of practices the Office of Fair Trading (OFT) may consider “deceitful or oppressive or otherwise unfair or improper”.
The move will allow the regulator powers to intervene in organisations deemed to be marketing debt to individuals without regard to whether they could afford to repay it.
“We are delighted the government has decided to make it clear that in future lenders will be under a legal duty to act responsibly when selling credit,” said Teresa Perchard of CAB.
“This will be backed by powers for the OFT to take action against those lenders who breach this duty.
“We have been calling for some time for a duty to lend fairly to be included in the much needed consumer credit reforms currently being considered by parliament, so this is an important and very welcome addition to the bill,” she added.
Credit providers have recently come under sustained fire from consumer bodies, MPs and regulators over the ways in which they market homeowner loans and unsecured finance.
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