High-cost credit review update

We are publishing an update on progress and direction of travel in our high-cost credit review, indicating the further work we are doing and the timelines for our work.

High-cost credit review update (PDF)

The update follows a Feedback Statement we published in July 2017 which identified key areas of concern with the sector including arranged and unarranged overdrafts, rent-to-own, home-collected credit and catalogue credit.

We have been gathering further evidence from firms on these products and consumer research is currently being completed.  We set out the issues we have identified and the actions we are considering.

We are prepared to look at solutions designed to increase the choice and encourage the availability of alternatives to high-cost credit. 

Who this applies to

This update will be of interest to:

  • consumer credit lenders that provide overdrafts (section 2), home-collected credit, rent-to-own and catalogue credit (section 3)
  • credit unions and community development finance institutions (CDFIs) and commercial innovators in alternatives to high-cost credit
  • trade bodies representing these firms
  • social investors, foundations  and other investors with an interest in alternative credit
  • local authorities and other social landlords
  • consumer organisations


Next steps  

May 2018

  • Report the results to date of our analysis of evidence on overdrafts.
  • Aim to consult on measures around overdrafts to address low customer engagement, promote competition and improve transparency for customers including on prompts and alerts.
  • Report on our review of the effectiveness of the Monthly Maximum Charge for unarranged overdrafts.
  • Report on the results of our analysis of evidence on rent-to-own, home-collected credit and catalogue credit and, depending on assessment of evidence, consultation on potential remedies.
  • Update on actions and discussions on alternatives to high-cost credit.


Towards the end of 2018

  • Consultation on a wider package of remedies on overdrafts.