Onerous regulation could lead to a smaller, more polarised credit market, according to the Finance and Leasing Association.
All new regulations for the consumer credit market should be examined by the Government for unintended and potentially damaging consequences, Stephen Sklaroff, FLA director general is set to tell the FLA Consumer Finance Conference today.
The industry is still implementing a huge volume of new regulation created by the last Government and this comes at a cost, he believes.
"Some customers are already finding it hard to get credit in the regulated markets, raising the risk of financial exclusion and, as a result, more frequent recourse to loan sharks. In April the amount of credit granted by FLA members was 9% lower than in April 2009," he says.
"If we are to avoid the serious social and economic consequences of a smaller, more polarised consumer credit market, a proper balance needs to be struck between consumer protection and maintaining a competitive market."
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Effective from 9 December 2019
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