The “right to know rates before applying for credit” campaign moves apace

Apply for a product and it puts a search on your credit file, which hits your credit score. Yet many products are rate-for-risk, so without applying you can’t know the rate.

This means many people apply for products, get accepted on a higher rate than expected, and then find it more difficult to go elsewhere because of the credit application.

A couple of weeks ago I wrote about how we were going to start campaigning on this, and things have already moved on with rocket speed.

  • Treasury Select Committee Enquiry.

    Last Tuesday the powerful Treasury Select Committee of MPs announced it was going to take up our suggestion to investigate this problem. As part of it, I’ve offered them space in the MSE forums to get feedback.

    This is great news, as the committee actually has the power to compel people to attend it and give evidence, meaning we can expect a thorough run-through of the problems, and hopefully a result that’ll help force the debt industry into change.

  • Reply from SCOR to our letter.

    I teamed up with Ed Mayo from Consumer focus to write a letter to the ‘credit data sharing committee’ (see the credit sharing letter).

    The chair of the committee has written back saying he thinks the issues raised are important. He’ll be putting it to his senior colleagues in the industry over the next few weeks, and will put it to the full committee when it next meets.

It’s my hope that these two, alongside the publicity generated from their actions, will make it clear to the industry that this type of behaviour is no longer acceptable.

People have a right to fair and transparent products – to know exactly what they’re signing up for – and it’s about time the financial services industry delivered that.

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