You are here: Home - Credit Cards & Loans - News -

New payday loan rules come into force

0
Written by: Paloma Kubiak
30/05/2017
New rules have come into effect requiring online payday lenders to publish details of their products on at least one price comparison website in a bid to help borrowers.

Lenders must also have a link to a price comparison site on their website such as to Money.co.uk, Moneyguru, Quiddicompare, Choose Wisely and All the Lenders to see which short-term loan is best for borrowers.

Both online and high street payday lenders must provide existing customers with a summary of their cost of borrowing.

The summary will tell borrowers what the total cost of their most recent loan was, as well as the cumulative cost of their borrowing with that lender over the previous 12 months and how late repayment affected their cost of borrowing.

The orders were implemented on 26 May and follow a 20-month investigation into the payday loan industry by the Competition and Market Authority (CMA), which revealed customers in arrears continued to be treated unfairly.

The payday loan industry has come under scrutiny over the last few years and as a result, lenders now need to meet stringent regulatory requirements on transparency, fees and fairness.

A payday loan cap was also introduced at the end of 2014, which stated that the cost of a payday loan must never exceed twice the amount borrowed and providers could not charge interest of more than 0.8% daily.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Which ISA is right for you? A round up of the six products available in 2017

From cash to innovative finance to lifetime, here's our guide to the ISA products available to savers this yea...

Guide to buy-to-let tax changes

In late 2015, former Chancellor George Osborne announced a range of  tax measures aimed at landlords, which t...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Five fund tips for a 0.25% interest rate environment

With interest rates stuck at a record low 0.25% and expectations rates could fall to close to zero, here are ...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Investing your money

Alliance Trust Plc gives you smart insight into how to invest your money

Money Tips of the Week

Read previous post:
Dog
Buckle in your pets or face having your car insurance claim rejected

Nearly one third of UK drivers are unaware their pets need to be suitably restrained when travelling in a vehicle,...

Close