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Payday loan providers ordered to freeze interest levels for struggling borrowers

Payday loan providers ordered to freeze interest levels for struggling borrowers

Borrowers who find it difficult to repay short-term loans may have fees and interest levels frozen, underneath the brand new measures.

A hundred payday and lenders that are short-term freeze interest and costs for struggling borrowers, under guidelines introduced by their trade associations.

The measures are section of a person charter drafted by four trade bodies – the buyer Finance Association (CFA), Uk Cheque and Credit Association (BCCA), the customer Credit Trade Association (CCTA) together with Finance & Leasing Association (FLA) – and implemented on 26 November. The 100 loan providers that are their users represent 90% of this total short-term loan market.

Underneath the charter, loan providers must:

• give information that is clear what sort of payday or short-term loan works and a typical example of the purchase price for every £100 lent, including costs and fees