Consumers could be offered car finance payment holidays as early as this week as part of financial help being offered by the Financial Conduct Authority.
Reports emerged last Thursday from the BBC that car finance payments could be next on the FCA’s list as it looks to ease pressure on consumers’ finances.
On April 9, the FCA said it would give finance firms the flexibility under its rules to provide temporary financial relief to those facing payment difficulties due to the coronavirus pandemic.
And it confirmed that motor finance was next up. A spokesperson confirmed to Car Dealer Magazine last Thursday that an announcement will be made on car finance ‘one day next week’.
The measures announced last week included:
- A payment freeze on loans and credit cards for up to three months
- A £500 overdraft with no interest offered to those affected
- Ensuring all overdraft customers are no worse off on price compared to before new overdraft charges were introduced
- Ensuring any consumer using these temporary measures will not have their credit history affected
Interim chief executive of the FCA Christopher Woolard said last week:
‘We know many people are suffering financial pressures brought on as a result of the coronavirus pandemic. The measures we’ve announced are designed to provide people affected with short-term financial support through what could be a very difficult time.
‘The changes will provide support for consumers with credit cards, loans and overdrafts, facing temporary financial difficulties because of the pandemic.
‘We know there is still more work to be done, and we will be announcing further measures to support consumers in other parts of the credit market in the future, including in the motor finance sector next week.’