Consumer credit and mortgage firms should be aware of the FCA’s latest comments on its continuing support for consumers impacted by Covid-19.
With the deadline for new payment deferrals coming up on 31 March, the FCA has reminded consumers that only those still on a payment deferral under the Payment Deferral Guidance (PDG) will be able to extend their deferral beyond that date.
The regulator is urging consumers facing financial difficulty to think carefully before taking a payment deferral, as other forms of support available under the FCA’s Tailored Support Guidance (TSG) may be better suited to their long-term needs.
From 1 April, lenders should support consumers impacted by the pandemic, whether or not they have previously had a payment deferral, with tailored support under the TSG that reflects individual needs and circumstances.
This could include short-term support such as a payment deferral, if appropriate, although this would be subject to normal credit reporting.
With demand for payment deferrals falling, firms now have the capacity to offer both shorter and longer-term support. The FCA believes this should provide better outcomes for consumers, as there is a wider range of more tailored options available.
The FCA says it will continue to monitor how firms implement its guidance, to ensure they continue providing consumers with support that properly reflects the challenges they face.
The regulator is planning to publish the findings from its initial supervisory work in this area by the end of the month.
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