The UK Government has updated its webpage on the payday lending market investigation by adding a note in “Phase 2” that the Competition and Markets Authority (CMA) has published a notice of its intention to make an order to address the features of the market which adversely affect competition as identified in its final report. The CMA has also published a draft Order and a draft explanatory note.
The draft explanatory note explains that the draft Order is divided into seven parts:
- Part 1 contains general provisions, which include specifying when the Order comes into force and the scope of the Order;
- Part 2 contains definitions that are used throughout the Order (and which are also used in the explanatory note);
- Part 3 prohibits the supply of payday loans unless the lender has published information on an FCA-authorised price comparison website;
- Part 4 prohibits the supply of payday loans unless customers are provided with a summary of the cost of borrowing;
- Part 5 contains an obligation on payday loan providers to produce compliance reports and submit them to the CMA;
- Part 6 contains provisions allowing the CMA to give directions as to compliance with the Order; and
- Part 7 relates to the provision of information to the CME for the purposes of monitoring compliance with the Order and reviewing its operation.
View Payday lending market investigation, 1 May 2015