I’ve seen some dodgy practice around retail finance, in my time. I’ve even seen fraud covered up by a retailer which didn’t want to lose its licence.
What I’ve seen most of is what I saw this week, eavesdropping as a designer at one of the sheds sold a loan improperly.
“It’s up to you if you want to read all the little writing,” he said. “It tells you how to cancel, and stuff.”
That’s not how it works. There are legal requirements about the information we have to give the customer, and this doesn’t satisfy them.
Why does it happen? It happens because retailers aren’t financial institutions: their training, their sales staff, and their daily processes are focussed on selling kitchens (in the sheds, a lot of cheap kitchens fast), by whatever means they need. Some of them also suffer – by their own choice – from blisteringly-fast staff turnover, which means that nobody has time to learn to do things properly before they’re looking for another job.
It’s illegal. It’s not policed. It results in customers entering into binding financial agreements to which they haven’t paid proper attention. Retailers have committed to doing this properly, and they just don’t.