Earlier this week the OFT published guidance designed to prevent bad practice with respect to marketing, charging and upfront fees. The office estimated 270,000 UK consumers paid an upfront fee to a sub-prime, unsecured credit broker in the past 12 months, typically between £50 and £70, on the expectation of being offered an unsecured loan.
Kevin Still, director of Atlantic, said: “There are many legitimate businesses such as Atlantic Financial Management in this sector providing fair, transparent and ethical services to indebted and vulnerable individuals. We strongly support any moves to improve consumer trust in our service.
“We are pleased that the OFT feels initial, post-contractual, arrangement fees as opposed to upfront pre-contractual fees are justified provided the fee is proportionate and transparent. We certainly support this view. Initial arrangement fees are a legitimate way for debt solutions business to cover the costs of setting up debt management plans and services for indebted consumers.
“We look forward to the updated OFT debt management guidance and hope this will go further to improve standards in our sector and build consumer confidence.”
