The Office of Fair Trading is to investigate fairness and competition in the credit card industry.
Credit card companies will come under increased scrutiny by the Office of Fair Trading (OFT) as it seeks to encourage fairness and competition in the unsecured consumer credit market.
The OFT has launched a consultation on its plans for dealing with the effect of the credit crisis on the financial services sector. According to the organisation, it will prioritise "in the short term" fairness and responsibility in the credit industry.
"With our focus on credit, we are addressing the area in which there is a real risk of short-term consumer harm while also ensuring that the sector that emerges from the current crisis is competitive and behaves fairly and responsibly towards consumers," said OFT chief executive John Fingleton.
The G20 meeting in London last week led to a promise from world leaders to shake up the financial services industry and ensure that markets are more tightly regulated. However, the OFT will seek to ensure that any measures taken by the government to deal with the downturn do not affect the health of the credit sector.
"Choice and competition involving existing players and new entrants are vital to delivering growth, prosperity and a good deal for consumers. There is a risk that this could be overlooked in the re-design of financial regulations, with high costs for consumers and the economy."
