The Creditfix Group welcomes today’s announcement by the FCA to ban debt packager firms receiving referral fees from debt solution providers. Commenting on the news, a spokesperson for Creditfix, said:
“The FCA’s announcement is a step in the right direction for people living with debt. The vast majority of the IVA market has been putting safeguards in place to protect their customers’ best interests already and this ban will play an integral part in reducing the potential for mis-sold solutions, which has become essential during the cost of living crisis.
“It’s important to note that there is no one size fits all debt solution. Good advice is essential to protect consumers and empower them to make the best decision for their personal circumstances.
“The Creditfix Group is committed to protecting clients which is why we made our own announcement on 12 April, ahead of today’s news, that the Group would no longer pay referral fees with effect from 1 May 2023, a full 5 months before the FCA’s ban comes into effect.
“However, while this is an important step, reform can’t end here. We must address the long-standing issues in the debt advice sector, including the availability of debt advice at a time when consumers are being weighed down by rising inflation. As the cost of living crisis continues, the free, private and third sector need to find innovative ways to reach those who are in desperate need of assistance.
“We also believe that all debt solutions should be reviewed in light of the current economic climate, with current non-statutory solutions being made subject to the same reporting metrics as statutory solutions. Only then can we analyse the true extent of the UK’s consumer debt problems and implement a long-term support strategy to guide the nation not only through this crisis but future proof the debt help industry for years to come.”