Family debt set to spiral

It has been suggested recently that family debt is set to spiral out of control over the next four years, with families expected to be struggling with average debts of around £84,000 per household. A report claims that the level of total household debt by 2015, including mortgages, loans, and credit cards, will reach an amazing £2,126 billion. For many this prediction is cause for concern given the difficult financial future that many people are already facing.

The documents were released by the government’s spending watchdog, the Office for Budget Responsibility. Over recent months this agency is said to have significantly increased its predictions when it comes to the size and level of household debt in Britain. At present the debt level stands at £1,628 billion but it is predicted that this will increase every year until the end of parliament in 2015.

The Office of Budget Responsibility has said that part of the reason for this increased forecast when it comes to household debt is the austerity drive from the government, which is set to have a huge impact on families and households, affecting their finances hugely. In June of last year the prediction was that household debt would stand at £1,823 billion by 2015.

There are concerns that as a result of the government cutbacks, the soaring cost of living, and wage freezes or cuts, many families will have no other option but to increase their debts in order to keep their heads above water, but their ability to do this and to repay their debts will eventually run out, leaving them in a very difficult financial situation.

Labour’s treasury spokesman David Hanson said: ‘Hard-pressed families will have to borrow more money to deal with the effect of George Osborne’s tax and benefits squeeze.’

Tags: Business Finance, credit, situation, government cutbacks, financial, option, debt level

Money Advice service now available for consumers

There is no doubt that there are many people these days that are desperate for financial advice, as they have a range of money issues that they need advice and help with, including debt advice, pensions advice, and advice on savings and other financial services. However, it has become increasingly difficult for people to get the advice that they needed over recent years, especially in respect of debt with demand for these services soaring.

However, the government has now launched its Money Advice Service, which is designed to provide consumers with advice relating to a wide range of financial issues that may be causing confusion or problems. Consumers are able to use the service online or can use it by phoning or visiting an advisor in person. The aim of the service is to offer free, impartial advice to those that have issues relating to their finances.

The service deals with a wide range of different areas relating to finance, and it is available to anyone that needs advice regardless of what their financial situation is. The service also offers access to a range of tools and resources for consumers to use in order to help them with their financial queries and issues. The service has evolved from the Consumer Financial Education Body, which was launched in 2010.

The service’s chairman Gerard Lemos said: “The Money Advice Service is here to make people’s lives easier and better. We’re not here to sell people anything and we won’t charge anyone – we are here to help people take decisions about their money and plan for a better future for themselves and their families.”

Another official stated: “It is important that everyone in the UK has the knowledge, skills and confidence to make the financial decisions that are right for them. We welcome the launch of the Money Advice Service as a new way to give consumers information about managing their money and choosing the financial products that are right for them.”

Tags: service online, financial, anyone, advice, way, service

Turner wants FSA to have more power to protect bank customers

The reputation of banks, and the confidence that consumers have in these financial institutions, has plunged over recent years, since the onset of the global credit crisis in 2007. With this in mind the chairman of the UK’s financial regulator, the Financial Services Authority, has called for the authority to be given greater powers to protect bank customers.

Lord Turner said that the FSA needs greater powers in order to protect consumers. The FSA is now set to launch a discussion paper based on the protection of bank customers. The debate will be centred around how the FSA could help, and what sorts of measures it could take in order to protect customers.

Officials from the FSA said that they want to find ways to take action to protect bank customers earlier on rather than having to wait until a number of complaints have been made before any action is taken. Some of the measures that the FSA is likely to look at will include the banning of some financial products, and a cap on the fees that are being charged on a variety of other financial products.

Lord Turner is set to argue that the FSA, or its replacement agency if it is disbanded, should be given greater powers to give bank customers the protection that they want and need. This comes following a surge in activity at the FSA, which has been cracking down on insider dealings, and has enforced a greater number of fines over the recent years.

Referring to the debate one FSA spokesperson said: “The debate will be about the types of things we do, different product regulation. Rather than waiting until lots of consumers have had to make complaints, can we take action earlier?”

Tags: replacement agency, agency, cap, paper, financial, confidence

Mortgage drought could affect many people

Industry experts have said that under current plans that have been proposed by the UK’s financial regulator, the Financial Services Authority, many people could be facing a mortgage drought that could leave them unable to get the mortgage finance that they need in order to get onto the property ladder.

The mortgage market is already very restricted, as it has been since the onset of the global financial crisis several years ago which almost brought the banking and financial systems to their knees. However, experts from the Council of Mortgage Lenders have said that things could get even worse under new rules from the FSA.

The Council of Mortgage Lenders has said that if these regulations had been in place over the past four years over 50 percent of mortgages that were granted over this period would have been refused, causing huge problems for those that were looking to buy a property and get onto the property ladder.

The CML claims that this would have equated to around four millions additional mortgage loan rejections if the FSA had its regulations in place in 2005. The group said that this shows just what a negative impact the rules could have in the current financial climate. A review by the CML suggests that under the new proposed regime millions more people a year could be turned down for a mortgage loan.

Figures show that the number of mortgage approvals in the UK have already plunged, with numbers having fallen to around 50,000 per month compared to 135,000 a months before the credit crisis hit. This has been made worse due to the strict restrictions that banks have put in place when it comes to lending, as well as the higher deposit levels being demanded.

Tags: market, council of mortgage lenders, financial, mortgage, Financial Services Authority, UK's financial regulator, property ladder, Mortgage loan

Lenders push borrowers into costly fixed rate deals

It has been claimed that some lenders have been trying to push their borrowers into costly fixed rate deals at a time when the base rate has been at an all time low of just 0.5 percent for the last eight months. Read more

Tags: low base rate, base rate, move, financial, would make sense

Success for sale and rent back tenants

A couple who got involved in a sale and rent back scheme after selling their home to a sale and rent back company which then stopped making the mortgage repayments on the property have enjoyed victory recently, when courts decided that they could continue living at the property. Read more

Tags: mortgage, victory, campaigners, sales, sale and rent back, financial, homeowners, abuse

King takes a stance on public borrowing

As most people are only too aware the public purse has taken a real bashing over the past year, with the government using taxpayers’ money for all sorts of measures in order to try and stabilise the financial system and improve the economy. Read more

Tags: recession, report, financial, general election, public borrowing, global downturn

£22 million in fines from FSA over 2008

Recently released figures have indicated that over the course of 2008 the Financial Services Authority handed down around £22 million in fines as it continued its crackdown against the mis-selling of payment protection insurance cover and tried to curb rising levels of mortgage related fraud. The UK’s financial regulator has been handing down record fines over the course of the year according to industry officials. Read more

Tags: disappointment, Financial services, fsa, payment protection insurance, financial, mortgage, time, ongoing problem

Will you be shopping or saving this Christmas?

The turmoil that has hit the financial markets over the past year have affected many of us in a number of ways, and tighter credit conditions coupled with soaring inflation, rocketing bills and petrol costs, high mortgage repayments, and other rising costs has left many of us with very little money to blow on spending, which has in turn affected the economy sending the nation spiralling towards recession. Read more

Tags: financial, Healthcare reform in the United States, industry, rising, moment, finance

Mind: Debt can exacerbate mental health problems

Consumers who suffer from mental health problems can find their health deteriorates when they get into debt and receive letters from financial institutions, the national association for mental health, Mind, has said.

A spokesperson for the organisation said that people in debt are not just receiving one letter a week, but a barrage of phone calls throughout the day from different people, which can feel “quite intense” for some people.

Recent research by Mind found that the biggest reasons for people getting into problem debt were mental health problems (66 per cent), living on a low income (66 per cent) and difficulties in managing money (58 per cent).

Mind said that it has been working with the Financial Services Authority to change the way in which lenders treat their customers who have mental health problems and fall into debt.

“We are calling on banks to keep to… a code of practice, about responding appropriately to things like missed payments and treating people who are worried and have anxiety and depression appropriately,” added the spokesperson.

Tags: Bipolar disorder, anxiety, Financial Services Authority, financial, authority, organisation, cent, Alternative medicine

Axa: Teenagers blow budgets in experiment

More than two-thirds of teenagers taking part in an experiment set up by the AXA Financial Task Force blew the budgets they were given for a week’s worth of household spending.

Given a budget of £248.40 each, 70 per cent of the 15 to 17-year-olds went over this amount and one child spent more than twice their budget, racking up a bill of £597.73 in seven days.

Axa is concerned that Britain’s young people are unable to cope with their finances and may find themselves in financial difficulty if they continue to overspend once they hit 18-years-old and can apply for credit cards and loans.

Research conducted by Axa shows 44 per cent of 15 to 17-year-olds are planning to get a credit card when they become adults and nearly one in five are thinking about getting a bank loan.

These concerns were raised soon after PricewaterhouseCoopers reported that in the first months of this year, 25,264 people went bankrupt or entered into an individual voluntary arrangement in England and Wales.

Tags: year, Teenagers blow budgets, financial difficulty, financial, teenagers, research, axa financial, Debt Financing

Chancellor to press lenders to pass on interest rate cuts to borrowers

Chancellor Alistair Darling is expected to tell mortgage lenders to pass on interest rate cuts to borrowers during a meeting with representatives from the Council of Mortgage Lenders next Tuesday (April 22nd), according to Bloomberg.

The Bank of England cut its base rate by 0.25 per cent last week and by three-quarters of a point since December, however many lenders failed to drop their mortgage rates.

Rates on the most popular mortgages rose to the highest level in eight years last month.

“We do need to make sure that people with mortgages see the benefits,” Mr Darling said in an interview in China today.

Following a meeting with banks on Tuesday, the government was warned that under the current credit crunch many smaller lenders could be forced to stop offering new mortgages, forcing consumers to turn to large providers.

The Bank is reportedly working on a plan to intervene in the UK mortgage market, according to The Financial Times.

Tags: financial, Mortgage loan, Council, interview, china today, rate, finance, Alistair Darling

Thoresen Review set to give consumers financial guidance

The government has announced details of new guidance designed to help consumers make more financially aware decisions.

According to the British Bankers Association (BBA), the proposals are designed to deal with the core problems of a public lack of understanding and awareness of financial services and how banks can help.

Otto Thoresen has been appointed by the economic secretary to the Treasury to undertake the review.

Angela Knight, BBA chief executive, said: “The BBA believes better financial education is key to ensuring people can make sensible plans for the future and provides us with the best hope of addressing the problem of financial literacy at a national level.”

She added that the Thoresen Review has identified a real gap in the financial knowledge among the population.

The recommendations included the implementation of a national money guidance service to be governed by the principles of impartiality, supportiveness, crisis prevention and universality.

Budgeting, saving and borrowing, protection, retirement planning, tax and welfare benefits are some of the topics covered by the new guidance.

Tags: level, proposals, financial, real gap, Gap, economic secretary

Co-op under fire over bank charges

The Co-operative Bank, which described itself as ‘ethical’ has come under fire after announcing a change to the way that it charges on unauthorised overdrafts.

According to experts the new charging structure that will come into force next month will not only push people into debt more quickly, but will also affect lower income customers the most. The changes are to take effect next month, and campaigners state that lower income banking customers could really bear the brunt of the changes.

The UK’s financial regulator, the Financial Services Authority, stated earlier this year that banks could temporarily put the brakes on issuing bank charge refunds until the High Court test case had taken place in January 2008. However, experts state that the new Co-operative Bank charges appear to be in violation of the FSA guidelines. This was because banks were told at that time not to make any material changes or raise overdraft fees.

The fee from the Co-operative Bank will still be capped at £100 per month, but under the new structure many customers will clock up a higher fee more quickly, reaching the £100 limit faster than they would have done over the old structure. It is estimated that close to one million customers could fall victim to this new charging structure.

An official from the Consumer Action Group stated: ‘These clever changes will hit those people who are eking out a living day by day and go over their limit just before pay-day. This happens an awful lot for people on benefits and people like young single mums, who run out of money just at the end of the month. If you are in a vulnerable group this will happen every month of your life. These changes are likely to break the camel’s back for them. The Co-op is just throwing this at them because it knows they have no mobility in their accounts and can’t go anywhere else because of their credit rating. This is an insidious charge based on the knowledge that those affected just can’t walk away.’

Tom Smith
7th December 2007

Tags: fsa, cost, fees, financial, capped, coop

FSA investigation leads to two arrests

An investigation into a so called boiler room operation by the Financial Services Authority has led to two arrests, according to a recent report.

The Financial Services Authority has been investigating claims of illegal share selling, which are known as boiler rooms, and after raids on a number of homes last week two men were arrested. The raids were carried out by the FSA along with police officers.

The two men arrested are thought to be involved with Universal Management Services (UMS), which is said to be a boiler room, which means a front for illegal share selling. It is thought that consumers that have fallen victim to this scam may have lost over £5 million collectively. Although these boiler rooms are usually operated from abroad, which means that the FSA cannot take action, the agency can act on those based and operated in the UK.

Reports claim that consumers were cold called in order to sell them the shares. Victims are talked into purchasing shares that are actually worthless of worth very little. The company responsible is not authorized by the FSA. The investigations started after a number of consumers complained about the pressure put on them by sales people, who then told purchasers to write cheques out to UMS.

Jonathan Phelan, head of retail enforcement at the FSA, stated: “This the first time we have taken this action and it shows that we will not hesitate to use our powers to protect consumers, including launching criminal investigations where appropriate.” As part of the investigation over £5 million worth of assets have been frozen, according to the report. The FSA also pointed out that there are at least four other companies with similar names in the UK but that they are not related to UMS.

Tom Smith
10th November 2007

Tags: fsa, boiler, criminal, dealer, authority, dealings, room, services, financial, shares

Interest payments on current accounts to be abolished by First Direct

The Internet banking arm of the HSBC, First Direct, has announced that it will be cutting interest charges on current accounts for customers.

According to officials from the bank the money that is saved from not having to pay interest on current accounts will be used to increase interest rates paid on savings accounts. However, following the mass exodus of customers earlier this year, after the bank announced that some customers would be charged monthly fees of £10, this could be a bad move for the online bank.

First Direct currently has two current accounts in place, and although these accounts do not enjoy the greatest interest rates there is still interest paid on deposits. The cheque account offers an interest rate of just 0.1% on credit balances, whilst the bank account offers 2%. However, in November the two accounts will be merged to create just one standard account known as the 1st Account, and this will pay no interest at all on credit balances.

Officials from First Direct state that customers will be compensated by way of better deals on their savings. An instant access account paying 5.5% will be available, although this is still far lower than the best buy savings accounts offered by other financial institutions, with the highest currently standing at 6.3%. An interest free overdraft facility of £250 will also be available to customers, along with free text banking that could help customers to avoid penalty charges applied when the account goes over its limit.

An official from the bank stated: “A staggering 96 per cent of our customers told us credit interest wasn’t an important factor in choosing to bank with us. We figured it made far more sense to use every single penny we now pay in credit interest to give customers the chance to earn serious interest on higher-interest savings accounts.”

Tom Smith
26th October 2007

Tags: accounts, customers, high, Banking, financial, savings, interest, direct, first

Job cuts at the FOS

In a recent report the Financial Ombudsman Service has announced that around a quarter of its workforce will be losing their jobs, as resources are streamlined to fit in with workloads.

Although the Financial Ombudsman Service has been receiving many complaints about bank charges it had been dealing with a high level of complaints relating to mis-sold endowment policies. The number of complaints relating to this issue reach its peak in 2005 but then began to taper off.

It is thought that the workload of the Financial Ombudsman Service will fall significantly in 2005, particularly if banks continue to reduce their overdraft charges, as many have stated they will be doing. Nearly a million complaints relating to endowment policies have been dealt with by the service of the past few years, with around seventy thousand complaints coming in for 2005. However, although more complaints were expected the issue seems to be cooling down.

One FOS spokesperson stated that staff number were being cut in order to align them with demand and workloads, and that it was hoped many of the job cuts would result from voluntary redundancy. The Financial Ombudsman Service is the main point of contact for complaints relating to financial institutions and services. The aim of the Financial Ombudsman Service is to try and resolve disputes between consumers and financial service providers, and award compensation in cases where this is deemed appropriate.

Bosses at the Financial Ombudsman Service will soon be starting consultations with the staff council in order to finalize the details of the job cuts.

Complaints relating to mis-sold endowments have dropped to under thirty thousand for this year, with one official from the FOS stating: “We are not processing the hundreds of thousands of endowment mortgage disputes since 2005.”

Tom Smith
24th October 2007

Tags: endowments, mortgage, vuts, ombudsman, financial

Rejected mortgage applications rise by 60%

In the past six months the number of mortgage applications being rejected has gone up by a staggering 60 per cent.

According to recent research by MoneyExpert.com, the amount of rejections this year has risen from 463,000 between January and March to 738,000 in the last six months.

The increase reflects interest rate rises and more specific lending criteria, the website explained.

Its chief executive, Sean Gardner, commented: “Life is tough at the moment if you’re applying for a mortgage. The financial environment is far more stringent than in the summer of last year and people need to be prepared for rejection.

“Lenders quite reasonably do not want to take risks when there are pressures on how much people can afford.”

Standard and Poor rating agency told the Financial Times newspaper that the mortgage slowdown is due to a “knock” to buyer confidence after the credit squeeze.

It added that mortgage lenders might look to further tighten underwriting standards and pricing on some types of mortgages.

Tags: underwriting, tighten underwriting standards, January, mortgage, poor

Benefit from low cost home insurance cover from Sainsbury’s

Supermarket giant Sainsbury’s recently announced changes to its credit cards that meant consumers would be able to enjoy longer interest free periods on purchases in addition to a low life of balance transfer interest rate, as well as other benefits.

The supermarket giant has now announced that it has some good news for homeowners that want to enjoy the peace of mind and security of having comprehensive home insurance cover in place without having to pay over the odds on this type of cover.

Sainsbury’s has announced a special deal that will be available for consumers that wish to purchase both buildings and contents insurance cover as a bundle package. These consumers will be able to get twelve months of cover for the cost of just nine months, saving them 25% on the cost of their premiums right away.

Furthermore, consumers that make the purchase online will be able to save a further 10% on the cost of their cover, which means that some consumers could save a whopping 35% on the cost of their cover for a year.

The offer is open to consumers that take out cover before the 27th November, and could attract many customers who are taking out cover for the first time or are due to renew their cover. As a special bonus consumers that take out this cover before 27th November will also enjoy being in with a chance to earn one million Nectar points. The cover includes protection against accidental damage, and customers are able to pay conveniently and easily by direct debit.

Officials from the company state that although insurance premiums on home and contents cover has risen recently, particularly after the flooding problems that hit the country in June, there are still affordable policies and deals available.

Tom Smith
9th October 2007

Tags: financial, buildings, personal, protection, flooding, contents

Could supermarkets soon take over current accounts market?

There was a time when supermarkets were only used for the purchase of groceries and household goods, but all of this has changed over recent years.

Many leading supermarkets in the UK have really branched out over recent years, and have started offering an array of financial products and services, such as insurance services, loans, and credit cards, amongst others. Many offer savings accounts as well as banking services, providing the consumer with far more choice when it comes to finding the best financial products and services.

A recent survey has revealed just how popular supermarket financial services have become in the UK, indicating that one in every ten consumers has a supermarket savings account, and one in every five shoppers holds a supermarket credit card. The figures show just how much business supermarket giants such as Asda, Tesco, and Sainsbury’s have taken away from the major banks in the UK. Figures also indicate that if supermarkets decide to branch out further they could take away far more business from banks.

According to the results of the survey around half of consumers in the UK would like to see supermarkets branch out and offer more in the way of financial products, as most think that supermarkets can offer far better value and service on such services and products. Current accounts seemed to be of particular interest, and although only one in every two hundred consumers has a supermarket current account at present, if more supermarkets offer this facility they could end up with close to half of the 40 million current accounts in operation in the UK today.

One industry expert stated: “This is a massive unpicked cherry for supermarkets to target. With their low running costs, supermarkets can easily undercut other providers. They are already pinching customers from banks and in time could steal even more.”

Tom Smith
25th September 2007

Tags: current, supermarkets, Insurance, consumers, financial

Free banking under threat, says BBA

Banks in the UK might introduce wide-ranging extra charges on current accounts, the British Bankers Association (BBA) said today.

The BBA said that the charges, likely to be fiercely contested by consumer groups, will bring the UK into line with regulations in the US, Australia and Europe.

Charges would include fees being levied to write cheques, to pay bills by direct debit and even to use cash machines.

According to a BBA, spokesman, the new fees would “follow patterns abroad where banks charge for transactions such as ATM use, direct debits and standing orders, in addition to an annual fee.”

The statement could be seen as a reaction to the bitter battle banks are currently locked in with customers and the Office of Fair Trading (OFT), over what is seen as their “unfair” charging procedures.

The Financial Services Authority (FSA) is currently investigating banks’ overdraft charges, and will release their findings in the autumn.

Tags: financial, overdraft, standing, Fair Trading, bitter battle banks, Banking

Overdraft claimants’ cases put on hold

Bank customers’ hopes of reclaiming what they see as unfair and excessive charges for going overdrawn took a serious hit today.

Industry watchdog, the Financial Services Authority (FSA), announced that banks would be allowed to only give money back when their investigation was finished, which is anticipated to be towards the end of this year.

Previously, it was agreed that high street banks and the Office of Fair Trading would allow courts to decide on whether the fees were illegal or not.

The British Bankers’ Association (BBA) welcomed the news in a statement “Banks believe the fees customers pay for unarranged overdrafts are fair and clear. However, this is clearly an issue where customers, as well as the banks, would welcome legal clarity.”

The OFT strongly disagrees with this position, saying that banks are contravening unfairness laws and that it is “seeking to establish this legal principle in court”.

Banks have paid out an estimated £200 million this year to customers claiming repayment of the controversial charges, which have affected some of the most vulnerable, debt-ridden customers in the UK.

The backlash against the charges has been immense, with almost two million downloadable claims forms being accessed online by irate customers.

Tags: office, Financial Services Authority, GBP, Overdraft claimants, financial, two million, debt-ridden customers

AIFA responds to government proposals

Recently the government announced its intentions to crackdown when it came to Independent Financial Advisers to ensure that consumers were receiving sounds advice based on their needs rather than on which lender would be the IFA the most money in commission.

The government stated that financial adviser services would become more standardized and that those wishing to operate as independent advisers would have to seek payment for the advice from the customer and not from the lenders that he or she recommends.

The European Commission has also put forward a green paper that recommends a single, standardized European market.

Chris Cummings from the Association of Independent Financial Advisers stated: “The EU should be mindful that the UK retail financial distribution market is unique because the majority of business in retail financial products is arranged through intermediaries. The delivery of this advice, according to Deloitte research, has the potential to improve the wealth of low to medium income earners in the UK from £38bn to £78bn even if only 10% were to optimise fully the advice given.”

He added: “We support the Commission’s views that there must be a rigorous and thorough analysis before introducing any new regulations, which takes into account both the benefits and the cost to firms and consumers, and the impact on the market. There are many reasons why consumers are naturally restricted from using cross border financial services such as language, taxation, social welfare and currency. The Commission must consider these issues before seeking to force standardisation that will not benefit consumers.”

A letter that has been signed by a number of industry professionals has been signed and sent to the commission to urge officials to improve their knowledge of consumer demand before any action is taken on this issue.

Tom Smith
24th July 2007

Tags: advisers, financial, invest, earn, ifa, independent, consumer, save

Consider financial ombudsman over bank charges

In the ongoing disputes relating to bank charges Lloyds TSB recently became the first bank to win a court case against a customer that was trying to reclaim bank charges that had been imposed for exceeding the overdraft limit on the account, and for returned cheques and direct debits.

And is seems that this unprecedented case has started to put some consumers off from trying to reclaim charges from their banks. However, experts advise that there is another route available.

This is Money has advised consumers that if they don’t feel confident about taking their bank to court of reclaiming bank charged they can simply go through the Financial Ombudsman Service. This is a free service, so consumers will have nothing to lose by taking their complaints to the ombudsman. And if, at the end of the day, the consumer does not agree with the financial ombudsman’s decision he or she can still take the case to court.

This is Money also warns that this cannot be done the other way around. So if a consumer takes the bank to court, and the judge rules in favour of the bank, the consumer cannot then take the complaint to the financial ombudsman because the judge’s ruling has to be the final one. So, anyone having trouble getting bank charges back from their bank should consider complaining to the FOS before taking the case to court.

Even banks are now using the Lloyds RSB case to try and make consumers feel as though this is a definitive decision, but this is not the case.

One FOS spokesman stated: ‘We are seeing letters from banks suggesting the Birmingham case is definitive. This is usually happening at local branch level. Often when we raise it at a senior level, head office agrees that the letters are wrong and stop any more going out.’

Tom Smith
10th June 2007

Tags: claim, court, charges, fees, ombudsman, financial, fines, bank, judge

New project to get affordable credit to everyone

A new project has been launched with the intention of helping people on low incomes to find affordable credit.

Citizens Advice (CAB) has linked up with the Association of British Credit Unions Limited (ABCUL) to launch the Financial Inclusion Partnership Project.

It is hoped that the establishment of the project will lead to a greater working relationship between the CAB and credit unions and help to establish benefits for the clients and the agencies involved.

“This is an exciting new project which will help people who are financially excluded,” commented Teresa Perhard from the CAB.

“People on low incomes often struggle to find affordable credit and feel forced into taking out loans with sky-high interest rates, sometimes through unscrupulous loan sharks.

“Credit unions give them an affordable, safe and dependable alternative. We look forward to developing local partnerships through the scheme,” she added.

The project is being supported by Barclays Bank and the Abbey Charitable Trust, with the latter providing small grants to individual participating bureauxs.

If you are in financial difficulties it may be worth contacting the CAB for advice. You should not seek to borrow money from a loan shark who will charge you crippling rates of interest.

Tags: financial, Association of British Credit Unions Limited, incomes, individual participating bureauxs, relationship, exciting new project, Barclays Bank, agencies involved."This

Beware bogus bank

Consumers are being warned to avoid the Northern Offshore Trust Bank.

The ‘bank’, which claims to be based in Guernsey, has been highlighted as featuring as part of an international scam, reports the BBC.

The Guernsey Financial Services Commission has warned that the bank is bogus and consumers are warned to avoid any contact with it.

It became apparent that something was wrong when it was realised that the names of directors of Norwegian telecoms firm Telenor were being illegally used to front the bank.

Jon Fredrik Baksaas, chief executive of Telenor, and his colleagues were listed as being employed within the fake bank, but they knew nothing of it.

The scam worked by persuading customers to invest £5 million via the bank.

Tags: contact, bogus bank, bbc, colleagues, financial