The Government have no plans to intervene in markets to reduce consumer borrowing. Restricting access to credit risks driving low income consumers to use illegal lenders. In other economies where controls exist the incidence of illegal lending is higher than in the UK.
The vast majority of consumers benefit from access to credit. Most manage their debts responsibly and are in control of their finances. However, for the minority who experience problems managing credit, the Government are providing support in form of measures to promote access to affordable credit and free debt advice.
In addition, the Consumer Credit Act 2006 has provided stronger protections for consumers. The OFT will now apply a more rigorous test of a firm's fitness to hold a consumer credit licence, including taking into account any evidence of irresponsible lending.