Friday, November 14, 2008

NFDA slams proposed PPI Changes


unprotected in the event of an inability to repay a loan,’ according to Sue Robinson, Director of the RMI National Franchised Dealers 

.The Competition Commission (CC) has made proposals to increase competition in the PPI market. Among the changes they wish to implement is a 14-day cooling-off period following the sale of the primary finance package that is intended to address a perceived point-of-sale advantage that deters consumers from shopping around for PPI cover. 


However, according to Robinson, the proposal will leave both car dealers and their customers worse off: ‘If this proposal is implemented it will mean that dealers will find it extremely difficult to sell these products. Consumers will in many cases forget to follow up, and are likely to be left unprotected. In the current economic climate, where many consumers are concerned about the possibility of redundancy, PPI is a crucial way of ensuring they are able, if the necessity arises, to cover their loan payment.’ 

The move could also have an impact on consumer interest in cars: ‘Unless customers feel they are able to repay loans even in the worst circumstances, they are unlikely to return to showrooms,’ said Robinson. 

Robinson also believes that if sales of PPI are reduced through the move, finance houses that are unable to protect customers from the inability to pay a loan, they may seek other ways of protecting their debt: ‘Such measures may include tighter lending criteria, and higher APR rates, all of which would be to the detriment of the consumer.’ 

Robinson concluded: ‘The Competition Commission is conducting a consultation on the issue, and in its response the NFDA will urge that this proposal be reconsidered in the interests of dealers and consumers, and in the light of current economic conditions.’ 

DATED: 14.11.08

FEED: RMIF

on, Director of the RMI National Franchised Dealers Association (NFDA).


# posted by Profit Training Ltd : 4:57 pm




<< Home

This page is powered by Blogger. Isn't yours?