Website to help consumers compare home credit loans

A new website will be launched in October 2008 to help consumers compare the price of home credit loans and loans repaid in cash from some other providers including credit unions.

lenderscompared.org.uk is the new, completely independent website established following the recent investigation by the Competition Commission into the Home Credit market.The new website is part of a package of measures designed to open up the market to greater competition and to highlight lower prices and bring more choice to consumers.

The new website helps consumers choose between loans by showing which lenders provide home credit in a local area and how much they charge. The website also includes information on loans provided by some credit unions. Customers who wish to compare Home Credit loans can type in their postcode and the website will show loans available in their area. Customers can compare different loan amounts and different durations of loan.

All lenders that provide a significant amount of home credit are obliged to publish their loans on the new website. Credit Unions and certain other providers of small loans do not have to be included but many are choosing to use this opportunity to show how their loans compare with those offered by commercial lenders.

The website is overseen by a governance board that includes representatives of the Office of Fair Trading, the National Consumer Council, ABCUL (Association of British Credit Unions Ltd) and the home credit industry.

Consumer Affairs Minister Gareth Thomas said: "This website will help people to save money and get a good deal. Consumers will be able to shop around for loans from Home Credit providers and local Credit Unions that best meet their needs."

"Home credit businesses provide a valuable service to some consumers, but the market is not as competitive as it could be. This website and other Competition Commission measures will increase competition - meaning lower prices and greater choice for the man on the street."

Nick Lord, Chairman of the governance board, said: For the first time, users of home credit will be able to easily compare the loans that are on offer in the areas where they live. We hope that those who borrow from home credit lenders will use the new website to get the loan that best suits their needs. Crucially, we also hope that those people who advise and support borrowers will also promote the use of the website.

Adam Land, Director of Remedies and Business Analysis at the Competition Commission, said: This website is a vital component of the package of remedies put in place following our market investigation. Along with other measures, such as data sharing, we expect that our remedy package will open up the market to greater competition, so that customers get more choice and lower prices. I have been impressed by the way in which the home credit industry has worked with other stakeholders to deliver this project.