At Fair for You, we think being a personal lender is important – we need to treat customers fairly, we need to understand and respect how our customer need to borrow, and how income can fluctuate and so customers need flexibility and tolerance with their repayments, not added fees or turning up at your door.
It isn’t easy when a customer is unable to make repayments, and we will always pursue customers for repayment of their loan as it is not fair for some customers to pay and end up with higher interest rates because others do not pay.
However, in all regards we believe we have a duty of care to not leave customers worse off – and part of that is to make sure that your credit file reflects whether you made payments or not. Your credit file should improve if you make payments.
Last week I was horrified to learn just how our customers feel when they keep making payments on high cost credit they have struggled to repay, and their credit file does not improve:
Fair for You uses your payment history rather than your credit ‘score’, so this doesn’t impact a loan through us. We look at your recent repayments even if there are older debts that are still being paid.
We do a few other things differently, too. Where a customer is unable to manage payments we will often accept a lesser amount and update the credit file to show the arrangement being made. We don’t sell the debt, and Fair for You will not add late fees (only expenses that are necessary in the case of ongoing non repayment – such as the County Court Judgement costs).
We know other high cost credit companies will increase the debt and then sell it on for repayment, and we don’t think that is a good way to treat people who are struggling.
However, only last week did I understand just how trapped our own customers have felt by their credit file.
This is very important to all credit companies now, that must do credit searches as part of affordable credit policies.
So tell us your experiences, and we will involve anyone else if this is important to our customers.
Jasmine Birtles of Money Magpie, patron of the charity, is passionately committed to lower income families getting a fairer deal and removing the poverty premium from those households. She will be working with us to make sure your stories and experiences are heard and that we get the regulators to act to make sure that anyone repaying their credit sees their credit file and rating improve.