The key messages shows that the Government feels like there are already a number of initiatives in place to address the recommendations and that it is not the Government’s place to influence commercial arrangements. However, this is hope for potential reform in the Consumer Credit sector.
Increasing Financial Inclusion
- Basic Bank Accounts – the Government will continue to work with the FCA on access to banking but it notes that the 9 biggest personal current account providers are already required to offer basic bank accounts. Furthermore, the Government disagrees with the notion of a standardised list of identification requirements and encourages industry to continue to use the JMLSG guidance.
- Consumer Education – the importance of this is already acknowledged by the Government who note they made financial literacy statutory in the secondary school curriculum in England. The Government notes it will continue to work with MAPS to support the Money Advice Service.
- Delegated authority and power of attorney – no action is suggested as the OPG recently published a guide on this to help staff in financial services companies.
Do Vulnerable Customers Pay More?
- Access to Insurance – the Government supports the FCA’s approach to consult on this in Summer 2019 in relation to sign posting customers to specialist insurers where the customer has a severe pre-existing medical condition.
- Bank Branch Closures – the Government confirms that it will not intervene on bank branch closures as it is a commercial decision for the Banks. It does, however, note its support for Banks continuing to act in accordance with the Access to Banking Standard where bank branch closures are happening. The Government also confirms that shared bank branches would be supported and does not breach competition law.
- The Post Office Network – the Government plans to support ongoing discussions between the Post Office and the banks as to how they can better serve customers but notes that this is a commercial matter between the PO and the Banks and will not intervene.
- Use of Cash and the Impact of ATM Closures – the Government notes that the Joint Authorities Cash Strategy Group was already set up to look at this.
The Equality Act and Provision of Reasonable Adjustments
- Equality and Human Rights Commission – the Government expects the FCA and EHRC to consider how best to ensure compliance with the Equality Act.
- Defining Vulnerability – the Government will continue to engage with the FCA to ensure the right protection is reached for consumers. This leads on from the Discussion Paper on Duty of Care.
- Access to Lower Cost-Credit – the Government plans to launch a feasibility study to design a No-Interest Loans Scheme.
- Treatment from Enforcement Agents – the Government confirms that the Ministry of Justice is already looking into this through their Call for Evidence examining the behaviours of enforcement agents. On the matter of the Council Tax Protocol – the Government confirms that it will not force councils to sign up to this – council tax collection is the responsibility of individual local authorities.
- Consumer Credit Act Amendments – the Government notes that it is currently reviewing the FCA’s final report on the retained provisions of the CCA and will consider whether further reform of the CCA is required. It further notes that reviewing the prescribed content in debt collection letters will be a priority during this piece of work.
- Creditworthiness Assessment Bill – the Government launched the Rent Recognition Challenge to address the issue of recognising rent being paid on time as a factor in credit scoring.