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Anyone that knows me knows that I am a man of reasonable logic, I speak my mind and stir up debate. As was said about me in Motor Finance, ‘As readers of his work and this publication will know, Hill always has a contentious opinion and is one of the most recognisable people at industry events, if only for the argument going on around him.’

That last bit might have more to do with my Rod Stewart style hair cut but that aside I’m totally confused by the new Consumer Credit changes that will be imposed by the new body, known as the Financial Conduct Authority (FCA), in 2014. I have just read a long article in Credit Today in which it gives a flavour of the proposals and the responses from the industry.

Now we all know that the credit industry in this country, indeed around the world, is imperfect and in dire need of change. There is a huge education void, illustrated by the fact that my simple guide to car finance is still the only proper guide to car finance available in the UK when half the bloody population has a car and all of those cars will be financed at least once during their life.

I applauded the fact that many issues were to be addressed such as irresponsible lending and dubious collection techniques which are still being employed. But when the whole of the credit industry seems to agree that the new regulations are ‘nothing to worry about’ the new authority hasn’t done its job right.

For example Andrew Smith of debt management company, ClearDebt believes that the prudential capital requirement, if it goes ahead ‘Will not be too onerous’. Russell Hamblin-Boone, chief executive of the Consumer Finance Association is said to have uttered, ‘There is nothing in the consultation document that gives him cause for concern.’

With others making similar noises I question whether the Government has got it right? With the introduction of a new regulatory controller I would expect them all to be ‘bricking it’ not ordering up another G & T. I don’t intend giving details of the proposals unless I think they are relevant but I despaired at a comment from Hamblin-Boone, bear in mind that the changes to be introduced are described as a new ‘risk based approach to lending’.

OK, got that? Now to me that suggests that the lenders have been lending irresponsibly and instead of concentrating on collecting toxic debts a new approach to lending is required in order to prevent the bad debt in the first place.

Agreed? Hamblin Boone is reported as saying: When considering the impact on the wider market he believes that consumers are likely to remain unaffected by the regulator’s high risk/ low risk approach. He says, ‘I don’t think there will be any less provision of credit but consumers will have much more confidence in the providers of consumer credit.’

So summing up, huge amounts of money are about to be spent on a new regulatory body that will have zero effect on lending. What a load of bullsh*t. Watch out for the launch of my new revealing book APR – A Simple Guide. That will certainly throw the cat amongst the pigeons! By Graham Hill

I have mixed views over my next piece. You see over the years I have recommended to clients that they make use of the law wherever they can to save money. One area that I have heavily promoted is covered by sections 99 and 100 of the Consumer Credit Act, better known as Voluntary Termination, whereby once you have paid half the total cost of the finance, you can simply hand the car back to the HP provider and they have to stand any loss between what would normally be required to Read more »