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Money Advice Service welcomes pensions advice role

Planning for retirement is a crucial life stage, and it is important that people feel well-informed and confident in the decisions they make, the chief executive of the Money Advice Service (MAS) said. Caroline Rookes added:

The Money Advice Service welcomes the Treasury's announcement that we will have a role in the provision of the retirement guidance guarantee.

We are pleased to have this opportunity to build on our existing work helping people as they approach retirement and with wider money issues.

– Caroline Rookes, chief executive of Money Advice Service

'Impartial' pensions guidance 'a real game-changer'

Millions of people will get free, impartial advice on how to make the most of their retirement savings under George Osborne's radical shake-up of the pension system. Pensions expert Ros Altmann, the Government's older workers' business champion, said:

The decision that guidance must be impartial and separate from the industry is a real game-changer and will help equip people to make the right decisions for them.

The challenge is now firmly with the industry to develop the products that people need, rather than simply the products they wish to sell.

– Ros Altmann, Pensions expert

Read: Govt to detail pensions overhaul with tax reforms

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Govt to detail pensions overhaul with tax reforms

The government will publish new rules for the pensions industry giving retirees greater access to their savings and free financial advice, fleshing out reforms announced earlier this year that shook the share value of British insurers.

Chancellor of the Exchequer George Osborne.
Chancellor of the Exchequer George Osborne. Credit: PA

Chancellor George Osborne caught Britain's pensions industry by surprise in March when he scrapped a rule forcing people to buy an annuity, a financial product which converts a retiree's pension pot into a guaranteed retirement income.

"It's right to support hard working people that have taken the long-term decision to save for their future and I'm pleased that the responses we had to our proposals on making pensions more flexible have been overwhelmingly positive," Mr Osborne said.

FCA reveals financial hardship of average loan users

Prior to announcing proposals for a new cap on the costs of taking out loans from payday lenders, the FCA conducted a survey of 2,000 representative customers.

The results identify the level of financial difficulties those borrowing endure.

RCA is proposing an initial cost cap of 0.8 per cent per day of the amount borrowed for new loans or loans rolled over. Credit: RCA
Currently 1.6 million people in the UK take out 10 million loans valued at a total £2.5 billion. Credit: RCA

Read: Loans cap wrestles with complex problem of lending

Crackdown on payday loan costs will hurt 'many people'

The head of the Consumer Finance Association, which represents the industry, has urged people to consider the full consequences of a crackdown on the high costs and charges enforced by payday lenders.

Anyone who thinks that a price cap is good news for borrowers should have a thought for those many people who will be turned down for loans because the best lenders will have to reject those with the worst credit records.

We support a cap that allows the industry to operate profitably with the right protection in place for vulnerable people. With new regulations and tighter affordability checks, critics must now face up to the fact that most people use, need and like short-term credit and the measures in place are more stringent than for any other form of consumer credit.

– Russell Hamblin Boone, chief executive of the Consumer Finance Association

Read: Loans cap wrestles with complex problem of lending

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FCA: For lots of people a payday loan 'is not a good idea'

For a lot of people borrowing from a payday lender "is not a good idea" and they can find themselves getting further into debt, a finance chief told Good Morning Britain.

Financial Conduct Authority (FCA) chief executive, Martin Wheatley, admitted the interest cap on payday loans would "restrict the availability of loans to some people" but it would keep customers away from toxic debt.

New costs cap will lose payday lenders £420m a year

Payday lenders will lose £420m in revenue a year as a result of the rate and costs cap being brought in from January 2015, ITV News Business Editor Joel Hills has tweeted:

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FCA estimates that as a result of their cap payday lenders will lose £420m in revenue per year.

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