Debts: Advisory Services:Written question - HL5192

Q
Asked on: 19 January 2016
HM Treasury
Debts: Advisory Services
Lords
To ask Her Majesty’s Government what assessment they have made of the case for a mandatory fee model whereby Financial Conduct Authority authorised debt management firms charge a set fee for debt management plans; and what assessment they have made of how to prevent debt management companies from making additional charges.
A
Answered by: Lord O'Neill of Gatley
Answered on: 02 February 2016

The Government has fundamentally reformed the regulation of the debt management market, transferring responsibility to the Financial Conduct Authority’s (FCA) more robust regime to better protect consumers.

Any consideration of the state of the debt management market should properly await the outcome of the FCA’s authorisation assessment of commercial debt management firms, which is expected in the coming months.

FCA rules make it clear that fees charged for debt management plans should not undermine the customer’s ability to make significant repayments to the customer’s lenders throughout the duration of the debt management plan.

Grouped Questions: HL5193

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