Citizens Advice welcomes FCA action on "unfair" payday lender behaviour
The Financial Conduct Authority has ordered payday lender CFO Lending to pay back £34m in redress to 91,000 customers because of “unfair practices”.
The watchdog uncovered a number of failings at the firm including the misusing of customers’ bank details to take payments without permission, and inaccurate loan balances resulting in some customers repaying more than they owed.
Gillian Guy, chief executive of Citizens Advice said:
“Irresponsible payday lending wreaks havoc on people’s finances.
“We welcome the FCA’s action to crackdown on CFO Lending’s unacceptable failings which have hit thousands of customers.
“Since taking over regulation, the FCA has cleaned up the payday loan market significantly with measures such as a cap on interest rates and fees.
“However, our recent evidence shows a quarter of borrowers say they were not, or could not remember being asked basic questions about their ability to pay back their payday loan.
“We want the FCA to tighten up its responsible lending guidance even further - forcing every single payday lender to carry out rigorous financial checks on potential borrowers.”
Notes to editors
- The Citizens Advice service comprises a network of local Citizens Advice, all of which are independent charities, the Citizens Advice consumer service and national charity Citizens Advice. Together we help people resolve their money, legal and other problems by providing information and advice and by influencing policymakers. For more see the Citizens Advice website.
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- To get advice online or find your local Citizens Advice in England and Wales, visit citizensadvice.org.uk
- You can get consumer advice from the Citizens Advice consumer service on 03454 04 05 06 or 03454 04 05 05 for Welsh language speakers.
- Local Citizens Advice in England and Wales advised 2.5 million clients on 6.2 million problems in 2014/15. For full service statistics see our publication Advice trends.
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