Citizens Advice Scotland (CAS) has backed proposals by the Financial Conduct Authority (FCA) for creditors to offer payment holidays and other relief to people in debt.
The FCA is proposing that debt providers:
• offer a temporary payment freeze on loans and credit cards where consumers face difficulties with their finances as a result of coronavirus, for up to three months.
• Ensure that for customers who have been hit financially by the coronavirus and already have an arranged overdraft on their main personal current account, up to £500 will be charged at zero interest for up to three months.
• make sure that all overdraft customers are no worse off on price when compared to the prices they were charged before the recent overdraft changes came into force.
• Ensure consumers using any of these temporary measures should not have their credit rating affected because of this.
The Citizens Advice network in Scotland is the biggest provider of free debt advice in the country, and people can get advice online through www.citizensadvice.org.uk/scotland or by contacting their local CAB by phone or email.
CAS Financial Health spokesperson Myles Fitt said:
“These are extraordinarily difficult times and people need every bit of help they can get.
“Everyone at this time should be focusing on their health and on preventing the spread of the virus, yet the evidence from calls to the CAB network suggests that many people are struggling financially.
“The package of measures outlined by the FCA today will help people through this crisis, so we support it.
“We would also urge that even further measures be considered, including the freezing of interest for people who qualify for a payment holiday.”