The CFA does show their concern that too much regulation may force lenders to leave the marketplace, which will give consumers less choice, rather than more, but they do encourage the FCA’s mandate to help customers make the best possible financial decisions, detecting the choices and encouraging competition.
The CFA considers itself as the principal trade association that represents lenders of short-term loans. They specifically list the good points about joining this trade association and confirm that they will not encourage any members to target consumers with debt problems, allow debts to spiral or lend to consumers they already believe cannot afford to repay the debt.
Encouragingly, they also suggest that borrowers do not deal with potential consumers who cannot confirm their identity or authenticity.
The CFA work with government regulators, MPs, the media, consumer groups and debt advice agencies, to improve the reputation of the industry. They claim that their spokespeople appear frequently across radio and television, as well as offering the CFA’s views to journalists and academics.
Consumers may be disappointed to find that the president of the CFA is also a high-ranking official of a payday lender, rather than being completely un-biased.
Members who operate within a code of practice that is monitored independently are listed on the CFA website so that a consumer can quickly identify if the company they are dealing with, is a qualified member or not.
The CFA website helpfully adds a page about payday myths exploded http://www.cfa-uk.co.uk/payday-explained/payday-myths-exploded.html where consumers can compare loans from different sources (overdraft, secured loan, credit card) to see how payday loans really do compare.
We would be pleased to hear from the association so that we can correct, update or confirm details about how payday loans are affected by this trade association.