The FCA introduced new rules in 2014 to regulate high-cost short-term credit, capping interest rates at 0.8% per day and limiting charges for late payments to £15 as of January 2015. The new rules also stipulate that total interest and fees cannot exceed the initial amount borrowed, so borrowers of £100 will pay back no more than £200 over 12 months. This overview was provided by BFWG Grants to explain the key effects of the new Financial Conduct Authority regulations.

1. FCA RULES 2015
A Simple Overview of FCA Rules

2. The FCA
 Look over control of High Cost Short Term Credit on 1st April 2014
 Introduced new rules during 2014
 Introduced rate capping on 2nd January 2015

3. Rate Capping
 The Rules:
 Daily Interest Capped at 0.8%
 The maximum charge for defaulting is £15
 Interest and charges cannot exceed the amount borrowed

4. What that means
 Daily Interest Capped at 0.8%
 So if you borrow £100 the maximum you will be charged per day is 80p per day.
 So if you only had the loan for a week (7 days) the maximum you will pay is
 80p x 7 = £5.60

5. What this means
 The maximum charge for defaulting is £15
 If you do not repay your loan on time, a lender can charge you £15, only once.
 So if you are late with another payment they cannot charge you the £15 again.

6. What this means
 Interest and charges cannot exceed the amount borrowed
 If you borrow, say, £100 over a 12 month period, the most you will have to pay
back, including the original loan is £200.

7. Who are We
 This information was brought to you by BFWG Grants
 www.bfwggrants.org.uk

8. Visit This Link
www.bfwggrants.org.uk