Clause 9 - Notice of sums in arrears under fixed-sum credit agreements etc.
Consumer Credit Bill
11:00 am
Mr Laurence Robertson (Shadow Minister, Economic Affairs; Tewkesbury, Conservative)
I beg to move amendment No. 20, in clause 9, page 8, line 6, leave out 'four' and insert 'six'.
The amendment relates to the notice of sums in arrears on fixed sum credit agreements. By and large, I support the requirements of clause 9. My only slight problem, which I have discussed with the industry, relates to subsection (8), which refers to weekly payments. Normally payments are made monthly, but there are occasions, particularly among lower income groups, where repayments are made weekly. My simple amendment seeks to address that.
The current requirement is that if two payments are missed, notices must be sent. That is to be increased to four payments, but four payments may not cover a tremendously long time. Several very small loan agreements may be repaid at the rate of £5 a week or so, and I am persuaded that the industry that operates in that market is often flexible. Money is collected on the doorstep; it is not sent by direct debit. A relationship can build up between the collector and the debtor, and it may be seen as heavy-handed if notices of missed payments and suggestions to seek advice on debt are sent too quickly, when arrears are only approximately £20. I want to do my bit to improve the Bill in that respect, by preventing it from being too heavy-handed in those circumstances.