Consumer Credit (Advertisements) Regulations 2004
On October 31st 2004 the way credit card adverts can
be run and what they can say and specify became regulated under the
Consumer Credit (Advertisements) Regulations 2004. This will have an
impact for the consumer known as the "card purchaser" under the
regulations. In what has for a long time been a cloudy area for the
consumer to understand and compare different credit card deals and
offers let alone the basic long term rates this can only be good news.
Some of the major changes affects the credit card consumer can expect to
see are as follows:
"The typical APR is an APR at or below which an advertiser reasonably expects, at the date on which an advertisement is published, that credit would be provided under at least 66% of the agreements he will enter into as a result of the advertisement."
In other words typical now means something definite. When an APR is advertised as TYPICAL you know at least 66% of applying consumers will reasonable be expected to receive that rate.
There is now a requirement for anyone displaying an advert to ensure those adverts:
"(1) use plain and intelligible language; (2) be easily legible (or, in the case of any information given orally, clearly audible), and (3) specify the name of the advertiser."
Advertisers must also display a postal address at which they can be contacted.
The typical APR must be displayed if an advert:
"specifies any other rate of charge;
indicates in any way, including by means of the name given to a business or of an address used by a business for the purposes of electronic communication, that— (i) credit is available to persons who might otherwise consider their access to credit restricted, or (ii) any of the terms on which credit is available is more favourable (either in relation to a limited period or generally) than corresponding terms applied in any other case or by any other creditors, or (d) includes any incentive to apply for credit or to enter into an agreement under which credit is provided."
In other words any advert that attempts to sell a deal or suggest a card is a good deal or compare it to other cards or tempt you in any way into believing it is offering you a deal must display the typical APR.
Advertisers can no longer display a range of APR's unless the lowest of those APR's (i.e. the best deal you are being offered) is offered to at least 10% of successful applicants. So you cant offer a single applicant a very low APR and then advertise that as your lowest available. At least 10% of applicants must be offered your lowest advertised rate. I any range of APR's the highest rate shown must be the very highest any person on that day would actually be offered. In other words any range of APR's must now be a true reflection of the highest to lowest rates being offered in their entirety.
APR's must be specified as %APR.
If an APR is subject to change i.e not fixed, then it must be specified as VARIABLE.
Typical APR's can only be described in that way, TYPICAL, and that must mean at least 66% of successful applications on that day wo8uld receive that rate.
Where any rate of charge, i.e. subject to a cost for the consumer, is displayed then the typical APR must also be displayed and given greater prominence than any other ate of charge.
Where an APR is displayed it must be in bold or 1.5x the size of the surrounding text.
"The typical APR is an APR at or below which an advertiser reasonably expects, at the date on which an advertisement is published, that credit would be provided under at least 66% of the agreements he will enter into as a result of the advertisement."
In other words typical now means something definite. When an APR is advertised as TYPICAL you know at least 66% of applying consumers will reasonable be expected to receive that rate.
There is now a requirement for anyone displaying an advert to ensure those adverts:
"(1) use plain and intelligible language; (2) be easily legible (or, in the case of any information given orally, clearly audible), and (3) specify the name of the advertiser."
Advertisers must also display a postal address at which they can be contacted.
The typical APR must be displayed if an advert:
"specifies any other rate of charge;
indicates in any way, including by means of the name given to a business or of an address used by a business for the purposes of electronic communication, that— (i) credit is available to persons who might otherwise consider their access to credit restricted, or (ii) any of the terms on which credit is available is more favourable (either in relation to a limited period or generally) than corresponding terms applied in any other case or by any other creditors, or (d) includes any incentive to apply for credit or to enter into an agreement under which credit is provided."
In other words any advert that attempts to sell a deal or suggest a card is a good deal or compare it to other cards or tempt you in any way into believing it is offering you a deal must display the typical APR.
Advertisers can no longer display a range of APR's unless the lowest of those APR's (i.e. the best deal you are being offered) is offered to at least 10% of successful applicants. So you cant offer a single applicant a very low APR and then advertise that as your lowest available. At least 10% of applicants must be offered your lowest advertised rate. I any range of APR's the highest rate shown must be the very highest any person on that day would actually be offered. In other words any range of APR's must now be a true reflection of the highest to lowest rates being offered in their entirety.
APR's must be specified as %APR.
If an APR is subject to change i.e not fixed, then it must be specified as VARIABLE.
Typical APR's can only be described in that way, TYPICAL, and that must mean at least 66% of successful applications on that day wo8uld receive that rate.
Where any rate of charge, i.e. subject to a cost for the consumer, is displayed then the typical APR must also be displayed and given greater prominence than any other ate of charge.
Where an APR is displayed it must be in bold or 1.5x the size of the surrounding text.
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