Doorstep Lenders Receiving Unwanted Interest

Unwanted interest has come from sources including industry regulator, the Competition Commission (CC), following an Office of Fair Trading (OFT) investigation which was in turn sparked by a super-complaint lodged by the National Consumer Council (NCC).

Doorstep loans offer small short-term loans to people who are on low incomes or without access to bank accounts, with repayments being collected weekly or fortnightly by collectors who directly call at the customer's homes.

Peter Freeman, chairman of the CC, said, "Customers value home credit because it suits their needs very well but the fact is that they are paying too much for it, because of the lack of competitive pressure in the market."

The regulator found that the lack of competition in the home credit market has meant that customers had, in their opinion, been overcharged by