More customers covered by ombudsman

Customers of up to 80,000 UK businesses are now covered by the Financial Ombudsman Service for the first time as the ombudsman's remit is officially extended under Consumer Credit legislation.

All businesses trading with a standard consumer-credit licence issued by the Office of Fair Trading now automatically come under the ombudsman. This means their customers will have access to the ombudsman's free complaints-handling service, in the event of a dispute relating to consumer credit such as loans, payment plans, pawnbroking and hire purchase.

The 80,000 firms set to come under the ombudsman's remit mostly offer consumer-credit services as an add-on to their normal business. As well as thousands of shops and retailers that provide finance facilities - from furniture stores and hifi specialists to kitchen-design showrooms and jewellers - businesses with a consumer credit licence also include sports clubs, piano-hire firms, builders, dentists and car-dealers.

For the ombudsman to be able to help, complaints about consumer credit must relate to an event after April 6th 2007 - and consumers need to have raised the problem first with the business concerned. Meanwhile, all businesses with a standard consumer-credit licence must now by law have formal complaints-handling procedures in place - to try to resolve any problem before the ombudsman gets involved.

Worth pointing out is that banks and building societies providing loans and mortgages - over two-thirds of the UK consumer-credit market - have been covered by the ombudsman for twenty years.

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2007-04-10 10:27:32 © Moneyextra.com