April 2020 – Impact of Coronavirus Pandemic final

03/04/2020

Debt Management - The Financial Conduct Authority (FCA) has proposed a three-month payment freeze on loans and credit cards, and zero interest on up to £500 of arranged overdrafts, for those impacted by coronavirus.

Intended to complement measures already announced to support mortgage holders and renters, furloughed employees and the self-employed, the FCA proposals include:

 An expectation on firms to offer a temporary payment freeze for up to three months on loans and credit cards where consumers face difficulties with their finances as a result of coronavirus

 A zero interest charge for up to three months on up to £500 of arranged overdrafts on main personal current accounts

 Imposing a requirement on firms that all overdraft customers are no worse off on price when compared to the prices they were charged before recent overdraft changes came into force and

 An expectation that consumers using any of these temporary measures will not have their credit rating affected because of this.

 These proposals are currently under consultation (ending on Monday 6 April 2020). If confirmed, the measures would start to come into force on 9 April 2020.

 Annual Leave - New regulations have been issued that introduce an exception to the bar on carrying forward untaken leave under the Working Time Regulations 1998 as a result of the effects of coronavirus.

In force from 26 March 2020, the amendments insert an exception to the bar on carrying forward untaken leave if it was not reasonably practicable for a worker to take some or all of the leave to which they were entitled as a result of the effects of coronavirus (including on the worker, the employer or the wider economy or society). Untaken leave as a result of the effects of coronavirus may be carried forward and taken in the following two leave years.

In addition, the regulations provide for payment in lieu of any leave carried forward under the coronavirus exception that remains untaken on the date of termination.

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