OFT announces tough line on lender

07/12/2009

The Office of Fair Trading (OFT) has taken action against a loans broker which "falsely" guaranteed customer access to credit.

Post Net, along with associate firms Haymarket Lending, Financial Processing and RG Debt Management, are now obliged to "not mislead customers" and to "fully disclose" application terms, such as arrangement fees.

Borrowers who cancel their agreements within 30 days are also to be guaranteed refunds under the new OFT regime.

The organisation has recently concentrated activities on lenders who offer credit to consumers with patchy repayments histories or those who have been out of work for long stretches in the past.

Demand for this kind of lending has increased in the recession, with many customers being shut out from high street banks which have adopted more stringent credit criteria.

Ray Watson, OFT director of consumer credit, said: "The OFT investigation gave rise to serious concerns with some of Post Net's business practices.

"We will monitor these requirements closely and will not hesitate to take further action if necessary."

Tags; Debt Management and Banking, Credit Card Lifestyle,

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