Consumer Credit Bill

My Lords, one of the principal tasks of the Office of Fair Trading under the Consumer Credit Act is determining whether someone is fit to hold a consumer credit licence. Evidence that an applicant has engaged in deceitful, oppressive, unfair or improper business practices is one factor that may indicate unfitness to hold such a licence, as set out in Clause 29. The amendment would spell out clearly that irresponsible lending is included in that criterion of unfitness. I welcome the amendment because irresponsible lending is a very serious mischief engaged in by some in the consumer credit industry. Lending to those who are already overcommitted with debt is irresponsible. I trust that this new provision will incentivise lenders and potential lenders to take a good deal of care in checking out the borrower’s means to repay and the extent to which repayment may be inhibited by the obligations that the borrower has to other lenders. I very much welcome the amendment.