If you’re thinking about taking out a loan, you should beware of unauthorised lenders, according to the Financial Conduct Authority (FCA).
You might remember that back in December, we told you about the FCA’s warning about 15 lenders to avoid over the festive season.
Since the start of this year, they’ve issued a further 44 warnings about lenders who they believe are working without official permission or authorisation.
Why is it a big deal if a firm isn’t authorised by the FCA?
Almost all firms and individuals carrying out consumer credit activities in the UK, such as lending money or offering debt advice, should be authorised by the FCA. However there are still some firms that act without their permission.
This leaves anyone who borrows from these firms vulnerable, as they won’t have the protection of a regulatory body to ensure they’re treated fairly.
When a firm has authorisation and permission to trade from the FCA it means there’s more protection for you as a customer, and an assurance that the company will follow the rules. Having no protection could lead to unfair treatment, such as inflated interest rates or upfront fees.
So who’s on the list?
The following firms are among the 44 who have received warnings since the start of the 2016 and the FCA believe are working without authorisation:
- I Text Loans (also known as Payday Loans 1000)
- Paice Ashton and Lord
- Payday Loans 12 months 3
- I Need Loans (website unavailable)
- C-7 Limited
- Loans for Everyone
- Mannex Global Corp LLC
- Indoloan Limited
- UK Today Loans (website unavailable)
- Lelo Loans (website unavailable)
- Happy Financers (website unavailable)
For the full list, please see the FCA’s News List.
While the sites listed by the FCA are simply not regulated, this also exposes a wider issue, that some loans could potentially be scams.
How can I protect myself from unauthorised firms?
If a firm doesn’t appear on the Register but claims it does, you should contact the FCA Consumer Helpline on (freephone) 0800 111 6768.
I’ve used or have been approached by one of these firms – what can I do?
If you think you’ve been approached by an unauthorised firm or contacted about a scam get in touch with the FCA Consumer Helpline on 0800 111 6768.
Be aware that if you give money to an unauthorised firm, you won’t be covered by the Financial Ombudsman Service or Financial Services Compensation Scheme (FSCS) if things go wrong. If you’ve given any money to one of these companies there’s no way for the Ombudsman or FSCS to intervene on your behalf.
If you’re struggling with your finances after taking out one of these loans, or are considering applying for a loan, get in touch with us. We can help you put together a budget and look into any debt solutions that may be available instead.
Our online advice tool Debt Remedy can help you put together a personal action plan in around 20 minutes.