skip to content
I’m proud to be introducing this ombudsman news as the newly-appointed chief ombudsman and chief executive. As a long-standing reader of ombudsman news, I’ve seen it reflect significant changes over its 119 issues – changes for the ombudsman, for financial services and for the outside world.
And from mobile technology to virtual currencies, it’s clear that some things are changing faster than ever. It’s certainly an interesting time for us all.
But some things happen more gradually. It was back in the early days of my ombudsman career – more than ten years ago – that the Department of Trade and Industry first set out its plans for reforming consumer credit, which later became the Consumer Credit Act 2006.
At that time, a cap on what was then referred to as “short-term loan interest rates” was decided against. Today, largely due to the publicity around payday loans, that form of lending has become controversial – and the new regulator has taken a different stance. It’s hardly surprising – a decade and a financial crisis later – that views have moved on.
We don’t set the rules at the ombudsman. But our unique position – hearing opposite perspectives on what’s not working and why – means we’ve a responsibility to understand and to share what we know. This time we’re talking about payday lending – an issue that’s rarely out of the news at the moment, whether portrayed as a symbol of everything that’s wrong with financial services or a practical solution in tight times. Unfortunately – as Juliana Francis explains in ombudsman focus – the complaints that are reaching us paint a really quite troubling picture.
We also highlight the increasing number of people who are telling us they feel they’ve got a raw deal from a credit broker. We know from experience that a rise in calls to us about a particular issue can be an indicator of something potentially more serious and widespread. I’m hoping this isn’t the case here – but we’ll be keeping an eye on what’s happening.
Of course, credit brokers and payday lenders are only two parts of a far wider lending sector – which ranges from credit unions to high street banks and building societies. It’s recognised that short-term lenders are offering credit where many larger businesses won’t. And customers of all businesses experience financial pressures and poor mental health. These are challenges for the sector as a whole.
But I think – on balance – things are moving in the right direction. We’ve seen encouraging signs recently that businesses are renewing their customer focus – and really are trying to make things better. I’m hoping this will be reflected in the cases we deal with – or, better still, don’t deal with – in months and years to come.
ombudsman news gives general information on the position at the date of publication. It is not a definitive statement of the law, our approach or our procedure.
The illustrative case studies are based broadly on real-life cases, but are not precedents. Individual cases are decided on their own facts.