FCA announces proposals to support motor finance and high cost credit products users struggling because of Covid-19

July 7, 2020

The UK’s top financial markets watchdog has announced new proposals to help motor finance and high cost credit product customers struggling because of the coronavirus.

The Financial Conduct Authority (FCA) has unveiled new proposals that outline the options firms will provide motor finance, buy-now pay-later (BNPL), rent-to-own (RTO) and pawnbroking customers who are coming to the end of a payment freeze, as well as those who are yet to request one. For customers yet to request a payment freeze, the time to apply for one would be extended until 31 October 2020.

For motor finance, BNPL, RTO and pawnbroking customers that have already taken up support, and who are still experiencing payment difficulties, firms would continue to offer support with options including a further payment deferral or reducing payments to an amount the customer can afford for a further three months.

“It is vital that people facing temporary payment difficulties because of the impact of coronavirus get the assistance they need,” said Christopher Woolard, interim chief executive at the FCA. “For those who have already taken a payment freeze and can afford to start making payments, even partially, it is in their best interest to do so, but for those that need help it will be there.”