Payplan, one of the UK’s leading and oldest established free debt solutions providers, has welcomed today’s warning by the Office of Fair Trading (OFT) to 129 debt management firms to start complying or face losing their consumer credit licence.
The OFT has given the offending companies three months to comply to its Debt Management Guidance – if they don’t, they face losing their licence and the right to operate.
The news has received a welcome response from national provider Payplan and other compliant organisations in the sector.
“Consumers who run into financial problems and have debt issues to contend with come to companies like our own at a very vulnerable time. It is vital they receive the correct service,”
said John Fairhurst, managing director at Payplan.
“We operate standards of best practice in free debt management, we believe strongly that creditors should play a part in helping financial recovery. This is fundamental to our working model. What is frustrating is other companies purporting to do the same when it’s clearly evident they don’t.”
Key Findings
The OFT report highlighted the following significant areas of non-compliance:
- misleading advertising, in particular not disclosing a fee and misrepresenting the services as being free when they are not.
- frontline advisers lacking in competence and providing poor advice based on inadequate information.
- lack of mention of the Financial Ombudsman Service (FOS) for resolving consumer complaints.
Today’s OFT report sets out a detailed action plan to improve standards across the industry, focusing on robust enforcement action against licensees that fail or refuse to change advertising and/or behaviour.
Commenting on the report, John Fairhurst added:
“We hope the OFT exercise will help create a level playing field which will mean complete transparency and, at the same time, safeguard consumers against poor advice and unfair practices.
“This is crucial. Our trained debt consultants deal with extremely harrowing cases of hardship on a daily basis. It is our duty as an industry to ensure we work with consumers and their creditors to provide the very best manageable solution possible. This isn’t a commodity or a peripheral service, it is people’s livelihoods at stake and they need to be receiving the best qualified advice and guidance at all times.”
About Payplan
Payplan has actively campaigned for the Government to regulate the debt management industry. Established in 1993, the company is one of the UK’s longest-serving providers, working with the Citizens Advice Bureau, National Debtline and the Institute of Money Advisers.
Payplan also partners with the credit industry, leading unions and employers – all with one combined desire – to provide totally free debt management services.
In its review of Payplan, the OFT did not raise any concerns or examples of non compliance with either the standards as set out in the Consumer Credit Act 1974 (the Act) or the OFT’s Debt Management Guidance.
Written by
on
September 28th, 2010
Filed Under
Debt News | Trackback |
2 Comments
2 Responses to “Payplan welcomes OFT action”
louisa says
Lizzy says