NCC in drive to make doorstep lending fairer

The National Consumer Council (NCC) has said it wants to make doorstep lending fairer for low-income families who are often forced to use the form of credit.

It has called for a "shake up" of the way the doorstep lending industry's agents are paid as well as a ban on roll-over loans, which can result in escalating interest costs.

The NCC is to make its proposals at the Competition Commission today in Manchester as part of an ongoing inquiry into the home credit industry.

NCC chief executive, Ed Mayo, said that there was no reason why low-income consumers should put up with less competition and lower standards than other borrowers.

"Agents may be the friendly face of home credit companies, but in the unique setting of the home, consumers are also vulnerable to approaches that lock them into a long-term borrowing relationship with one home credit provider," he explained.

"A ban on roll-over loans with the same provider - alongside other key reforms to the agent-customer relationship - could go a long way to injecting more competition to benefit customers."

The NCC recently carried out a study into home credit, which found that customers rarely switched between different companies, showing that competition in the industry is currently too weak.