Coronavirus (COVID-19) Update: FCA Confirms Temporary Measures For Financial Relief For Customers Impacted By The Coronavirus

The FCA has approved the proposed measures, outlined in a previous consultation, designed to promptly support users of certain consumer credit products who are facing financial difficulties arising from the Covid-19 pandemic. The FCA statement on the confirmed measures can be viewed at the following link:

On behalf of the FCA, Christopher Woolard stated, inter alia: that many people are suffering financial distress as a result of the pandemic and these measures could provide some short-term financial support. These measures are targeted to consumers with credit cards, loans and overdrafts that are negatively affected by the pandemic. Nevertheless, customers who still have the capacity to make payments are advised to continue to do so. Additional supportive measures for other credit markets, e.g. the motor finance sector, will follow.

The measures require firms to:

  • offer a temporary payment freeze on loans and credit cards for up to three months, for consumers negatively impacted by Coronavirus
  • allow customers who are adversely affected by Coronavirus and who already have an arranged overdraft on their main personal current account, up to £500 charged at zero interest for 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 pricing changes came into force
  • ensure consumers using any of these temporary payment freeze measures will not have their credit file affected

The time-frame of measures in place

The rule changes will be in force from 9 April 2020 and the total full range of measures will apply by 14 April 2020. The time in-between will allow firms to ensure they have the appropriate level of resources needed to handle their customers’ requests. Some firms, including banking institutions[1] and building societies, will be adopting these changes as of today (9 April 2020).

The FCA suggests that consumers should firstly check the firms’ websites and social media platforms as well as their online services to request assistance prior to contacting the firms by telephone in order to avoid increasing pressure on call centres.

Guidance on the products covered under the confirmed measures

The FCA confirmed that the following products are covered: guarantor loans, logbook loans, home collected credit, a loan issued by Community Development Finance Institution and some loans issued by credit unions, but only where these are regulated. The guidance also applies to firms which have acquired such loans.


How we can help: Should you need any guidance or assistance in dealing with issues related to Coronavirus (COVID-19) or matters relating to compliance with FCA or related regulatory matters, please contact:

[1] The banks and building societies who are implementing the changes from today are – HSBC, Lloyds, RBS, Barclays, Santander and Nationwide.