Comment from Neil Kadagathur, CEO Creditspring on FCA Consumer Duty

“UK households have been in desperate need of added protections in the cost of living crisis so the Consumer Duty is hugely welcome news. The crisis is highlighting just how perilous people’s budgets are and the UK’s reliance on credit with millions forced to borrow to survive the next couple of months as inflation worsens and the impact of the next energy cap spike is felt. It is vital that these people are protected from unscrupulous lenders charging extortionate repayment terms.

“Ending high borrowing charges and fees will provide a lifeline for households who otherwise risk falling into an unmanageable debt spiral. By forcing lenders to provide clear and accurate information around charges and repayment terms, borrowers are empowered to make improved financial decisions. It also boosts trust in the sector as currently many people avoid contacting lenders when they need financial support. We previously found 75% of people believe that lenders are only out to make a profit and 43% believe they’re encouraged to borrow more than they can afford.

“Creditspring’s no-interest, subscription model is saving its members £17m in borrowing costs by offering a no-interest alternative to high-cost credit options whilst enabling them to build their credit files to unlock access to mainstream credit in future.”

Neil Kadagathur, Co-Founder and CEO of Creditspring