The Financial Conduct Authority (FCA) has announced that since April it has investigated more than 200 consumer credit promotions. The regulatory body has said that these promotions were "non-compliant" with its regulations, as they were potentially misleading to customers in that they did not state the financial dangers involved.
Since the start of April, 1,500 promotions from various payday lenders, credit brokers and debt management services have been examined – 227 of which fell short of the FCA's expectations. Common examples of promotions deemed unsatisfactory included:
- Adverts that suggested the firm in question would provide credit to customers no matter what their circumstances or credit history.
- Fee-paying debt management adverts that failed to explicitly state that customers cannot enjoy the services for free.
- Sponsored links that did not match the search terms, such as 'government debt help', which led searchers to non-government, and thereby irrelevant and misleading, websites.
Four out of five misleading promotions found within digital media
The regulatory body said that 80 per cent of these non-compliant promotions were found within websites, emails and text messages. A quarter of the 227 were short-term credit advertisements that did not state the potentially high risk or APR involved.
The FCA's director of supervision, Clive Adamson, has said that promotions will be closely monitored in the future. He commented: "It is important that all firms ensure financial promotions are fair, clear and not misleading so that customers are able to make informed decisions. We believe that firms in this sector can do more to ensure financial promotions meet the standards we would expect."
Conscientious credit control is vital
When hiring for any vacancy in your credit control department, at any level, it is vital that you choose a candidate that is conscientious. Being able to sensitively deal with clients who are experiencing financial difficulties is key to succeeding in any of the numerous roles in credit control.
If you would like to receive expert advice, please give our team a call and we will put you in touch with one of our credit control recruitment consultants.