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Consumer Credit regulation could be expensive for all

Datamonitor is warning one of the effects of the overhaul of the UK&#39s consumer credit laws could be higher cost of credit and greater difficulty in obtaining credit for those consumers with adverse credit histories.

It says a tight implementation schedule, lack of adequate preparation, fears of increased bureaucracy and cost of compliance present a major worry for the credit industry, and could even end up driving smaller specialist lenders out of business all together, leaving room for more unscrupulous providers.

Datamonitor financial analyst Oksana Selezeneva says: “Consumers with adverse credit histories could potentially be faced with higher cost of credit and less protection. It is also likely that mainstream providers will attempt to compensate for lost revenue streams and additional expenses in relation to compliance efforts and pass some of the costs to their clients”

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