MPs calling for more regulation of high-cost credit providers and debt management firms have singled out payday advance companies in a bit to improve the level of consumer protection present, no credit check loans experts recently reported.
In addition to instant cash loan providers, the bailiff industry, the Money Advice Service, and commercial debt advice firms all came under fire during a recent Commons debate regarding where policy actions should be concentrated upon in order to increase consumer protections. Debt advice was particularly targeted as one of the areas where a closer look was needed.
Stockton North Labour MP, Alex Cunningham, commented that the Money Advice Service was apparently a new group attempting to find its way in the world, yet a clarification of its role was needed quite desperately. Commercial debt management companies were also critisised by Charham and Aylesfort Conservative MP, Tracey Crouch, claiming that they routinely put customer welfare second.
Ms Crouch added that while additional regulation is not a topic she welcomes typically, it may be all too necessary to reining in rogue debt management companies. A clear bias currently exists towards strong-arming customers into plans that will allow the debt management firm to shift the focus from steadily paying down their debts over time to instead choosing a plan which will yield the most in fees for the company, the Conservative MP also added.
With these plans obviously not within the best interests of consumers, oftentimes they will fail to accomplish their stated goals because the monthly payments – much like the level of debt – is simply too high.