Financial Conduct Authority set deadline for borrowing measures amid coronavirus pandemic
Those who are struggling financially amid the coronavirus pandemic should be offered an interest free overdraft up to £500 for 90 days according to the UK’s financial watchdog.
According to the Financial Conduct Authority, repayments on credit cards and loans ought to be frozen for up to three months for those who are in trouble.
The outbreak had caused an “unprecedented financial shock” according to the FCA.
Banks have been criticised by experts for offering support them deem to be “patchy”.
The City watchdog has asked banks to respond to their deadline by 6 April, and to put measures in place by 9 April.
In a recent announcement, the FCA said that banks have increased charges for some customers, around the sum of 40 per cent.
The watchdog said that: "Over the next 90 days, firms would have to ensure all consumers are no worse off and not paying more than they would have under previous prices."
Interim chief executive of the FCA, Christopher Woolard, said that: "If confirmed, the package of measures we are proposing today will help provide affected consumers with the temporary financial support they need to help them weather the storm during this challenging time."
While some lenders have put measures in place to aid those impacted by the coronavirus pandemic, founder of Moneysavingexpert, Martin Lewis, referred to the situation as a “banking lottery”.
Personal finance analyst at Hargreaves Lansdown, Sarah Coles, said that: "If you're struggling to afford interest and debt repayments, don't assume any of these things are in place until it's confirmed by your bank. If you just halt payments without confirmation, you may end up being chased for payments and having charges added to your debt.”