Lenders prepared for 2 January price capping regime, says Uncle Buck
On 2 January 2015 the new price cap regime comes into effect. The regime has three key elements:
- Initial cost cap – 0.8% per day interest on the outstanding principal
- Cap on fixed default fees and charges of £15 , interest at the same rate as the initial cost cap calculated per day on the outstanding principal and fixed default charges
- Total cost cap of 100% of the amount borrowed so a consumer will never have to pay back more in fees, charges and interest than 100% of what they borrowed
Some lenders have already implemented the new regime in their charging mechanisms and amended their websites to reflect this. This is good news for consumers, who will benefit earlier from any price reductions, especially where lenders previously charged a fixed fee per period. Representative APRs are falling as interest is charged on a daily basis. Media comment has also recognised the changing regime.
Uncle Buck Payday Loans will be adhering to the new requirements in its loan products, which will offer increased flexibility for customers. The website will also fully explain the new pricing regime and customer facing legal documents such as the SECCI, adequate explanations and consumer credit agreement will fully reflect these changes so customers will have complete clarity and transparency relating to the details of their loan product.
If you would like to know more detail about our payday loans product visit https://www.unclebuck.tv/about-uncle-buck.html