UK commits to reform of the Consumer Credit Act

sourcrates

Plans to modernise consumer credit laws to cut costs for businesses and simplify rules for consumers have been announced by the government -

UK commits to reform of the Consumer Credit Act - GOV.UK (www.gov.uk)

ForumUser7

sourcrates said:

Plans to modernise consumer credit laws to cut costs for businesses and simplify rules for consumers have been announced by the government -

UK commits to reform of the Consumer Credit Act - GOV.UK (www.gov.uk)

Hopefully they won’t be cutting costs for businesses by weakening section 75. It would be good if they strengthened this actually, and made it apply in a wider price range than it currently operates within.

EDIT - https://www.thisismoney.co.uk/money/cardsloans/article-12286895/Section-75-credit-card-protection-watered-down.html

TheMaverick000000

They should get rid of those EU banking laws that criminalise ordinary law-abiding citizens. Bank accounts should be a human right. Currently, banks are cancelling those rights.

grumbler

S75 for CC purchases has to be abolished, not 'modernised'. This is an archaic and absolutely nonsensical piece of legislation.
And no, I'm an ordinary customer and am not connected in any way to CC providers.

MattMattMattUK

I agree S75 has to go, as do many of the protections for when people are idiots. What ultimately happens is those costs are passed onto the rest of us who do not put our credit card details into random sites or buy from dodgy traders, the same with the banks being made to refund amounts when customers choose to transfer all their money to fraudsters, that cost is then passed onto the rest of us which is ultimately unfair. 

DullGreyGuy

ForumUser7 said:

sourcrates said:

Plans to modernise consumer credit laws to cut costs for businesses and simplify rules for consumers have been announced by the government -

UK commits to reform of the Consumer Credit Act - GOV.UK (www.gov.uk)

Hopefully they won’t be cutting costs for businesses by weakening section 75. It would be good if they strengthened this actually, and made it apply in a wider price range than it currently operates within.

How would you want them to strengthen it @forumuser7? It already makes the creditor jointly and severally liable with the merchant. You think a credit card company should have to payout more than what the merchant would have to or...?

The law as it stands makes no sense as it was written in the times of store finance not credit cards. It makes no logical sense to be as it is but then laws dont have to make sense as I'd say the distance selling rules are also too generous - should be much easier for merchants to charge excess handling costs.

ForumUser7

MattMattMattUK said:

I agree S75 has to go, as do many of the protections for when people are idiots. What ultimately happens is those costs are passed onto the rest of us who do not put our credit card details into random sites or buy from dodgy traders, the same with the banks being made to refund amounts when customers choose to transfer all their money to fraudsters, that cost is then passed onto the rest of us which is ultimately unfair. 

 https://www.thisismoney.co.uk/money/markets/article-12292263/Barclays-wins-appeal-bank-transfer-fraud-ruling.html
https://www.telegraph.co.uk/money/consumer-affairs/blow-for-bank-fraud-victims-supreme-court-ruling/?utm_content=money&utm_medium=Social&utm_campaign=Echobox&utm_source=Twitter#Echobox=1689174080

DullGreyGuy said:

ForumUser7 said:

sourcrates said:

Plans to modernise consumer credit laws to cut costs for businesses and simplify rules for consumers have been announced by the government -

UK commits to reform of the Consumer Credit Act - GOV.UK (www.gov.uk)

Hopefully they won’t be cutting costs for businesses by weakening section 75. It would be good if they strengthened this actually, and made it apply in a wider price range than it currently operates within.

How would you want them to strengthen it @forumuser7? It already makes the creditor jointly and severally liable with the merchant. You think a credit card company should have to payout more than what the merchant would have to or...?

The law as it stands makes no sense as it was written in the times of store finance not credit cards. It makes no logical sense to be as it is but then laws dont have to make sense as I'd say the distance selling rules are also too generous - should be much easier for merchants to charge excess handling costs.

It would be good if they strengthened this actually, and made it apply in a wider price range than it currently operates within. for example £0 - £50,000.

It is one of the main points that makes a credit card so helpful because of the enhanced buyer protections. I don't know anything about the context of when it was written, but it's pretty much the sole reason I want a credit card, other than to built my credit history which in itself is only really to help get better credit cards (and loans and overdrafts etc., but I would prefer to avoid these) - to help me when a seller won't comply with the Consumer Rights Act.

That said, as of right now no one has accepted me on an eligibility checker for a card, so it wouldn't yet make a difference for me.

Re DSR, is that handling costs only for when a consumer changes their mind that you'd like to see be made easier for merchants to charge? To some extent I agree, but only if the item has been suitably advertised (proper description, specifications, pictures etc.). For faulty items or those that arrive damaged, really they aught to not charge handling fees IMO.

jj_43

It’s not fair on those in credit card debt to pay for free protection on credit card purchases and needs reform.

DullGreyGuy

ForumUser7 said:

DullGreyGuy said:

ForumUser7 said:

sourcrates said:

Plans to modernise consumer credit laws to cut costs for businesses and simplify rules for consumers have been announced by the government -

UK commits to reform of the Consumer Credit Act - GOV.UK (www.gov.uk)

Hopefully they won’t be cutting costs for businesses by weakening section 75. It would be good if they strengthened this actually, and made it apply in a wider price range than it currently operates within.

How would you want them to strengthen it @forumuser7? It already makes the creditor jointly and severally liable with the merchant. You think a credit card company should have to payout more than what the merchant would have to or...?

The law as it stands makes no sense as it was written in the times of store finance not credit cards. It makes no logical sense to be as it is but then laws dont have to make sense as I'd say the distance selling rules are also too generous - should be much easier for merchants to charge excess handling costs.

It would be good if they strengthened this actually, and made it apply in a wider price range than it currently operates within. for example £0 - £50,000.

It is one of the main points that makes a credit card so helpful because of the enhanced buyer protections. I don't know anything about the context of when it was written, but it's pretty much the sole reason I want a credit card, other than to built my credit history which in itself is only really to help get better credit cards (and loans and overdrafts etc., but I would prefer to avoid these) - to help me when a seller won't comply with the Consumer Rights Act.

That said, as of right now no one has accepted me on an eligibility checker for a card, so it wouldn't yet make a difference for me.

Re DSR, is that handling costs only for when a consumer changes their mind that you'd like to see be made easier for merchants to charge? To some extent I agree, but only if the item has been suitably advertised (proper description, specifications, pictures etc.). For faulty items or those that arrive damaged, really they aught to not charge handling fees IMO.

It used to be £30 but increased to £100 in the 80s... the problem of having a low (or no) floor is that the cost of investigation outweighs the amount being claimed. You could otherwise buy a kitkat every day for 85p and then put in a S75 claim saying it tasted funny despite being in date. The bank cannot spend time setting up files, gathering evidence etc to try and defend a 85p claim. 

S75 requires the Debtor - Creditor - Supplier chain to be in tact, when it was created most credit would be when you go into furniture shop and want to buy a new bed and the supplier has done a deal with BlackHorse or such to offer credit. So the triparty arrangements really existed as the creditor had vetted both the supplier and the debtor and had a say if they were happy to get into the arrangement. The Creditor was putting their name next to the shops. 

With credit cards there is technically a fourth party involved in the form of the supplier's merchant bank. The Creditor is not in contract with the supplier and so has no opportunity to decide that John Lewis sells good clothes so happy to give credit there but really bad electronics and so they dont want to be on the hook for them. The mechanisms we have doesn't allow a credit card provider to do that and so they get forced to be on the hook which goes against the rational for the bank being jointly liable. 

For the DSR/CCR I was thinking of change of mind returns where the customer has clearly used the item and returned in a state where it cannot be resold as new. Shoes coming back without tags and clear scuff marks, vacuum cleaners with scratches around the assembly screws and hair wrapped around the brush etc. 

ForumUser7

DullGreyGuy said:

ForumUser7 said:

DullGreyGuy said:

ForumUser7 said:

sourcrates said:

Plans to modernise consumer credit laws to cut costs for businesses and simplify rules for consumers have been announced by the government -

UK commits to reform of the Consumer Credit Act - GOV.UK (www.gov.uk)

Hopefully they won’t be cutting costs for businesses by weakening section 75. It would be good if they strengthened this actually, and made it apply in a wider price range than it currently operates within.

How would you want them to strengthen it @forumuser7? It already makes the creditor jointly and severally liable with the merchant. You think a credit card company should have to payout more than what the merchant would have to or...?

The law as it stands makes no sense as it was written in the times of store finance not credit cards. It makes no logical sense to be as it is but then laws dont have to make sense as I'd say the distance selling rules are also too generous - should be much easier for merchants to charge excess handling costs.

It would be good if they strengthened this actually, and made it apply in a wider price range than it currently operates within. for example £0 - £50,000.

It is one of the main points that makes a credit card so helpful because of the enhanced buyer protections. I don't know anything about the context of when it was written, but it's pretty much the sole reason I want a credit card, other than to built my credit history which in itself is only really to help get better credit cards (and loans and overdrafts etc., but I would prefer to avoid these) - to help me when a seller won't comply with the Consumer Rights Act.

That said, as of right now no one has accepted me on an eligibility checker for a card, so it wouldn't yet make a difference for me.

Re DSR, is that handling costs only for when a consumer changes their mind that you'd like to see be made easier for merchants to charge? To some extent I agree, but only if the item has been suitably advertised (proper description, specifications, pictures etc.). For faulty items or those that arrive damaged, really they aught to not charge handling fees IMO.

It used to be £30 but increased to £100 in the 80s... the problem of having a low (or no) floor is that the cost of investigation outweighs the amount being claimed. You could otherwise buy a kitkat every day for 85p and then put in a S75 claim saying it tasted funny despite being in date. The bank cannot spend time setting up files, gathering evidence etc to try and defend a 85p claim. 

S75 requires the Debtor - Creditor - Supplier chain to be in tact, when it was created most credit would be when you go into furniture shop and want to buy a new bed and the supplier has done a deal with BlackHorse or such to offer credit. So the triparty arrangements really existed as the creditor had vetted both the supplier and the debtor and had a say if they were happy to get into the arrangement. The Creditor was putting their name next to the shops. 

With credit cards there is technically a fourth party involved in the form of the supplier's merchant bank. The Creditor is not in contract with the supplier and so has no opportunity to decide that John Lewis sells good clothes so happy to give credit there but really bad electronics and so they dont want to be on the hook for them. The mechanisms we have doesn't allow a credit card provider to do that and so they get forced to be on the hook which goes against the rational for the bank being jointly liable. 

For the DSR/CCR I was thinking of change of mind returns where the customer has clearly used the item and returned in a state where it cannot be resold as new. Shoes coming back without tags and clear scuff marks, vacuum cleaners with scratches around the assembly screws and hair wrapped around the brush etc. 

I guess I was thinking that if the price was really low, consumers wouldn't bother with an S75. I don't think I would bother for anything under £30.00 probably. But that makes sense as to why the lower limit isn't £0. That said, I've never done it before so dependent on how arduous the process is there may be a higher threshold before I bothered.

Re DSR - I agree when it has clearly been used. But when a customer has changed their mind because it didn't fit the description fully, or it arrived and it wasn't suitable, as they've had no opportunity to inspect it in the shop there shouldn't be restocking fees imo.

DullGreyGuy

ForumUser7 said:

DullGreyGuy said:

ForumUser7 said:

DullGreyGuy said:

ForumUser7 said:

sourcrates said:

Plans to modernise consumer credit laws to cut costs for businesses and simplify rules for consumers have been announced by the government -

UK commits to reform of the Consumer Credit Act - GOV.UK (www.gov.uk)

Hopefully they won’t be cutting costs for businesses by weakening section 75. It would be good if they strengthened this actually, and made it apply in a wider price range than it currently operates within.

How would you want them to strengthen it @forumuser7? It already makes the creditor jointly and severally liable with the merchant. You think a credit card company should have to payout more than what the merchant would have to or...?

The law as it stands makes no sense as it was written in the times of store finance not credit cards. It makes no logical sense to be as it is but then laws dont have to make sense as I'd say the distance selling rules are also too generous - should be much easier for merchants to charge excess handling costs.

It would be good if they strengthened this actually, and made it apply in a wider price range than it currently operates within. for example £0 - £50,000.

It is one of the main points that makes a credit card so helpful because of the enhanced buyer protections. I don't know anything about the context of when it was written, but it's pretty much the sole reason I want a credit card, other than to built my credit history which in itself is only really to help get better credit cards (and loans and overdrafts etc., but I would prefer to avoid these) - to help me when a seller won't comply with the Consumer Rights Act.

That said, as of right now no one has accepted me on an eligibility checker for a card, so it wouldn't yet make a difference for me.

Re DSR, is that handling costs only for when a consumer changes their mind that you'd like to see be made easier for merchants to charge? To some extent I agree, but only if the item has been suitably advertised (proper description, specifications, pictures etc.). For faulty items or those that arrive damaged, really they aught to not charge handling fees IMO.

It used to be £30 but increased to £100 in the 80s... the problem of having a low (or no) floor is that the cost of investigation outweighs the amount being claimed. You could otherwise buy a kitkat every day for 85p and then put in a S75 claim saying it tasted funny despite being in date. The bank cannot spend time setting up files, gathering evidence etc to try and defend a 85p claim. 

S75 requires the Debtor - Creditor - Supplier chain to be in tact, when it was created most credit would be when you go into furniture shop and want to buy a new bed and the supplier has done a deal with BlackHorse or such to offer credit. So the triparty arrangements really existed as the creditor had vetted both the supplier and the debtor and had a say if they were happy to get into the arrangement. The Creditor was putting their name next to the shops. 

With credit cards there is technically a fourth party involved in the form of the supplier's merchant bank. The Creditor is not in contract with the supplier and so has no opportunity to decide that John Lewis sells good clothes so happy to give credit there but really bad electronics and so they dont want to be on the hook for them. The mechanisms we have doesn't allow a credit card provider to do that and so they get forced to be on the hook which goes against the rational for the bank being jointly liable. 

For the DSR/CCR I was thinking of change of mind returns where the customer has clearly used the item and returned in a state where it cannot be resold as new. Shoes coming back without tags and clear scuff marks, vacuum cleaners with scratches around the assembly screws and hair wrapped around the brush etc. 

I guess I was thinking that if the price was really low, consumers wouldn't bother with an S75. I don't think I would bother for anything under £30.00 probably. But that makes sense as to why the lower limit isn't £0. That said, I've never done it before so dependent on how arduous the process is there may be a higher threshold before I bothered.

Re DSR - I agree when it has clearly been used. But when a customer has changed their mind because it didn't fit the description fully, or it arrived and it wasn't suitable, as they've had no opportunity to inspect it in the shop there shouldn't be restocking fees imo.

If you hang around on these forums long enough you'll realise that someone comes up with a brainwave like "I made £500 my putting in claims for all my sub £5 transactions this year"and plenty of people will jump on that bandwagon. You'll get claims management companies springing up just like PPI, packaged bank accounts, diesel German cars etc etc. 90% of cases will have no moral merit but companies wont have the staff or the appetite to fight them.