The Consumer Finance Association (CFA) has raised concerns about the composition of the panel advising the Financial Conduct Authority, on the review of unsecured credit and buy now pay later products.
In a media statement earlier this week, the CFA said it had concerns that the views of smaller firms were not being considered due to the profile of figures on the FCA’s advisory panel.
The advisory panel includes Provident Financial’s chief executive Malcolm Le May and Vim Maru, the chief executive of Lloyds Banking Group’s retail bank. It also features Steven Cooper, chief executive of C Hoare and Co and Kirsty Ward, the director of M&S Bank.
Jason Wassell, chief executive of the Consumer Finance Association, said: “Having now seen the composition of the advisory panel, we are concerned that there is a lack of representation from the unsecured credit market itself.
“We had hoped that industry representatives from across the sector would allow for an informed review.”
The Woolard Review, so-called as it will be led by Chris Woolard who recently left the FCA, has been established to evaluate levels of innovation and change within the unsecured credit market and a full industry-wide analysis is scheduled to be published in 2021.
It will consider the impact of coronavirus on employment security and credit scores, changes in business models and new developments in unsecured lending, including the growth of unregulated products in retail and the workplace.
The CFA said it was also concerned that the call for input terms were so broad that the review would fail to explore the real issues facing the unsecured lending sector and its customers.
It added the review should focus on how consumers access modern credit and how the current system fails those who are underserved.
The 12-member advisory panel also includes StepChange chief executive Phil Andrew and FCA director of retail and regulatory investigations Therese Chambers.
The CFA said that while it welcomed the involvement of Le May, it felt that only banks were being asked to represent the benefits of consumer credit.
Wassell said: “The unsecured credit market includes many small companies that fill the gap left by the banks. These firms are finding it extremely difficult to operate with tightening regulation and the impact of Covid-19.
“Without addressing these issues, we struggle to see how any recommendations made to the FCA board could be effective.”