BBA has responded to the UK BIS consultation on implementing the CCD. It supports the idea of building on existing laws but is not sure some suggestions comply with the maximum harmonisation aims of the Directive. It is also worried there may not be enough time between the final implementing legislation being published and its effective date for firms to make major changes. It asks whether the Government might give more time for firms to comply with areas which are a big change from the current law. Among the major comments are:
- the importance of OFT and FOS having power to control remedies under consumer credit law, rather than the courts;
- why BIS does not plan to use the "overdraft repaid within one month" exemption. This will be important because overdrafts for high net worth customers will be regulated and cause significant costs for lenders. It makes several other comments about high net worth borrowers and how the regime will apply to firms' dealings with them;
- supporting the approach taken to second charge mortgages;
- concerns over the approach to dealing with creditworthiness, which BBA feels is prescriptive and inflexible;
- whether BIS could remove the current requirement to have a signature box, especially for non face-to-face contracts as the CCD does not require this;
- detailed comments on proposals for dealing with variations; and
- significant concerns on early repayments, but BIS has already agreed to discuss this further with BBA.