FCA finds 'disappointing' lender practices on arrears

In instances where the regulator identified appropriate arrears practices, it found some firms had appointed designated call handlers to maintain a consistent point of contact for customers and saw examples of firms agreeing reasonable arrangements on sustainable terms.

The review intended to examine the impact of extended forbearance in long-term arrears cases, following a previously identified trend of increasing arrears but falling home repossessions.

The regulator said extended forbearance could potentially cause harm to customers if the arrangements were unaffordable and debt continued to grow, but overall found no evidence of widespread harm to customers as a result.  

The FCA said it expects firms to review their practices in line with guidance on good and poor practice and make necessary changes where appropriate to meet its expectations in minimising harm to customers.