The United Kingdom has one of the most regulated financial services market with a powerful and well-funded regulator maintaining an orderly and stable market. The Financial Services Authority creates implements and polices the vast array of regulations relating to Banks, Insurance Companies, Investment Companies, Brokers, Advisers and other Intermediaries. These regulations encompass UK and European legislation as well as Conduct of Business regulations and cover the management and sale of investments, saving, lending and insurance.

However the loans sector, in contrast to other product groups, seems to enjoy a 'lighter touch' from the regulator and is largely a free-market. While this has benefited the consumer by creating a vibrant and competitive market with regular new entrants, including loan packagers, brand players (e.g. Virgin) and even utility companies, there are many instances of aggressive selling of poor-value products to vulnerable sections of the community.

At present the many lenders marketing their 'consolidation loan' products via television, radio and newspaper advertising to lower income consumers is a particularly worrying practice. These advertisements often focus on the ability to significantly reduce monthly payments through consolidating existing loans with the implication that this equates to a lower cost debt solution. However these products typically charge excessive rates of interest, and while they may indeed replace higher rate lending, the longer period of these loans make it likely that on a fuller analysis of individual