Financial body asks lenders to offer more support

Lenders should act now to make sure that borrowers struggling with payments and vulnerable customers can access help as living costs rise, the City regulator has said.

The Financial Conduct Authority (FCA) wants lenders to do more to help people in financial difficulty and said it is concerned that some customers in vulnerable circumstances are not getting the support they need.

The regulator is reminding lenders that they should provide support to struggling borrowers that is tailored to their specific circumstances and only charge them fees that are fair and cover the firm’s costs.

With household bills expected to continue to rise into the autumn, the FCA is writing to more than 3,500 lenders to remind them of the standards they should meet.

Most firms need to have better conversations to fully understand their customers’ individual circumstances, so they can provide appropriate tailored support and ensure that arrangements to pay back debt are sustainable, the regulator said.

Some lenders are not discussing the potential benefits of money guidance or free debt advice or helping and supporting borrowers to access these, it added.

People who are struggling to manage their finances should speak to their lenders for support as early as they can, the FCA said.

They can also get free support and advice, for example, through the MoneyHelper service, it added.

The FCA said serious failings were found at more than 30 firms, largely in the consumer credit sector, and that it expects these companies to make improvements in how customers are treated.