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DEBT SUICIDE BANKS UNDER THE COSH |
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Following the well publicised suicides of a number of debtors one of whom ratcheted up £100,000 of Credit Card debt on 16 plastic cards MP´s on the influential Treasury Select Committee will be grilling top executives from Britain´s High Street Banks over the nations´ snowballing 60 billion pound credit card debt.
A year has gone by since Matt Barrett, then Barclays´ Chief Executive, said "borrowing on a Barclay Card was too expensive" and that he did not borrow on credit cards.
Two issues arise. The first the committee will investigate is why the banking industry has been slow to offer its customers better deals, and with the industry having failed to make headway on clarifying comparative charges, it is no wonder the Select Committee is anxious.
The second issue concerns credit granting - with the Committee´s Chairman, John McFall demanding banks do more to share information on individuals to help ensure those already heavily indebted do not take on additional borrowing.
With some 1.82 billion credit card transactions taking place last year in the UK, sharing debtor information amongst the various credit card companies will be a gargantuan task.
Sharing debt judgment information can be fairly straight forward with the credit reference agencies already available to deliver reports to high street lenders in a sophisticated electronic format.
However, setting a standard for credit granting amongst the different banks is an entirely different story. Who is to say because someone has twelve credit cards they should not be entitled to a thirteenth (unlucky for some) if the individual has an impeccable credit history?
However, it has to be recognised, a serious problem does exist and must be addressed. Those in our society who are desperate for cash will be tempted to take on new credit cards if available. The blame should not lie at their door. If the problem has to be tackled then it must be addressed at the lenders´ door. Serious discussions should be entered into between the high street banks and the government to see if there could be some way of early identification of particular debtors who are in financial difficulty (possibly prior to Judgement) and an evaluation made whether an additional card should be made available to that individual. A simply prompt on a computer screen suggesting the individual contact their nearest high street branch with appropriate money advice liaison facilities on hand would go a great deal towards addressing the problem.
Should you have any questions in relation to credit control or debt recovery issues, please visit our website at www.debtscotland.com where you will find a wealth of free resources.
Stephen Cowan
Yuill & Kyle
Debt Recovery and Credit Control Lawyers
scowan@yuill-kyle.co.uk: 0141 572 4251
www.debtscotland.com
www.ykcreditcheck.co.uk
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