The Lending News Bulletin: 1-15 December

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In the first half of December the industry news included topics on consumer spending at Christmas, consumer credit trends and financial inclusion.

 

Regulation round-up December 2018 | FCA | December 2018

The FCA has produced its monthly round up for December’s regulation news. In the consumer credit section, the FCA issues a reminder to furniture companies that they should be careful to comply with advertising promotions on their website. The FCA states that this kind of business needs to state the the minimum spend required when they have ‘0% Interest Free Credit’. The other news of interest to readers of the Lending News Bulletin, will be that of the Brexit update; whereby when the UK leaves the EU, the FCA will become UK regulator of credit rating agencies and trade repositories.

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Consumer Credit Originations Poised For More Growth In 2019 | PYMNTS.com | 12.12.18

Credit reporting agency, TransUnion, has forecasted for 2019 that consumer credit originations and consumer balances will increase for a majority of credit products. They predict delinquency rates will remain flat, although that is not necessarily the case the credit card and mortgage type credit. TransUnion said that this news is positive for consumers as they will be able to improve on their credit scores as they will likely have greater access to credit. For lenders it is also on the up too, as it is a prime opportunity to expand their book when delinquency rates are at these current levels.

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UK high streets face quietest Christmas since credit crunch | The Guardian | 10.12.18

Forecasters have suggested that this Christmas could be the quietest since the credit crunch with a 4.2% decline in footfall compared to 3.5% last year. The UK’s high street has faced difficult trading conditions, not just this year, but over the last ten years where footfall has only increased once – in 2011. Reasons cited for the footfall reduction this year include a low consumer confidence induced by Brexit, competition with online retailers, and shoppers choosing experiential gifts rather than physical products. The high street has seen more discounting this year.

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Financial Inclusion in a Digital Age | UK Finance | 13.12.18

UK Finance along with Capco have produced a report called Financial Inclusion in a Digital Age which examines how a digital approach helps with improving consumers’ access to their financial services. When they talk about ‘access’ and ‘inclusion’, in a tangible form these mean things like 24 hour access, streamlined apps for budgeting and banking, and video servicing in addition to producing reduced costs and a more accurate and efficient service[source]. While much of this report is applicable to retail banking, there are some key takeaways for the lending and credit industry. Such as enabling omni-channel’ experiences (the seamless transition from one channel to another without disruption to the customer journey) as well as designing new products and services alongside customers.

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