The FCA has today published a consultation on proposed new rules to help credit card customers in persistent debt.

The regulator said it expects savings would peak in the first few years of the proposed rules being in place, at between £310m and £1.3bn per year.

This follows an April 2017 consultation paper which proposed firms, at designated timeframes, prompt customers to make faster repayments or propose repayment plans, as well as intervening earlier if customers struggle to repay.

It also proposes that where a customer cannot afford any of the options proposed to repay their balance more quickly, firms must take further steps to assist them to repay the balance in a reasonable period, for example by reducing, waiving or cancelling any interest or charges.

The latest consultation includes a revised analysis of the costs to businesses of the proposed remedies, to take into account additional data the FCA has received and some data that was omitted from previous calculations.

The FCA is seeking further views before finalising proposals, in line with their statutory and public law consultation duties. The consultation will run for six weeks, ending on 25 January 2018, and the FCA expects to make new rules as early as possible next year.

FCA chief executive Andrew Bailey said: “The proposals we are introducing will save consumers billions of pounds by reducing longer-term borrowing on credit cards, which can be very expensive and can hide real financial hardship. We remain committed to action to protect consumers in the credit card market as soon as possible.”

The FCA’s remedies are based on its in-depth study of the credit card market, which analysed 34 million credit card customers’ accounts over five years and surveyed nearly 40,000 consumers to build up a comprehensive picture of credit card use.

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