PARLIAMENTARY WRITTEN QUESTION
Loans: Interest Rates (12 September 2017)

The Government has fundamentally reformed regulation of the consumer credit market, transferring regulatory responsibility from the Office of Fair Trading (OFT) to the Financial Conduct Authority (FCA) in April 2014. This more robust regulatory system is helping to deliver the Government’s vision for a well-functioning and sustainable consumer credit market which is able to meet consumers’ needs. Treasury ministers and officials meet regularly with the FCA to discuss relevant regulatory issues.

The Government does not hold the requested estimate, but the FCA’s rules require firms to reasonably expect that in at least 51% of credit agreements entered into as a result of a promotion, credit will be provided to the consumer at the representative APR or lower. The FCA’s rules also require firms to ensure that their communications and financial promotions are fair, clear and not misleading. The FCA is able to impose tough sanctions, such as banning products, imposing unlimited fines and ordering firms to pay money back to customers, where wrongdoing is found.