Credit Cards & Loans
City watchdog to probe £150bn credit card market
The city watchdog is to investigate the UK’s £150bn credit card market, focusing on whether competition is working effectively for consumers.
The Financial Conduct Authority (FCA) said the investigation would focus on the most ‘at risk’ households.
FCA chief executive Martin Wheatley said: “The key priority here has to be those in the most vulnerable circumstances. Many of whom are struggling to manage their credit card commitments, as well as other bills.”
According to the FCA, 30 million Britons have at least one credit card.
The charity StepChange said around 10 per cent people who contact them for advice have five or more credit cards and an average total debt of £27,000.
Wheatley added: “We know it’s not uncommon for the most ‘at risk’ households to hold multiple cards and revolve multiple balances month-by-month.
“There are some obvious questions and challenges here for regulators and industry: why are card issuers providing the means, in some cases, for the most indebted consumers to escalate their way into further debt?”
The competition review will launch at the end of this year.
The FCA took over regulation of consumer credit firms from the Office of Fair Trading on 1 April.
