An OFT investigation revealed that Swift, trading as Swift Advances and Swift Securities, was awarding loans without making the appropriate customer checks.
The OFT found Swift failed to identify whether borrowers could afford the loan, verify their income, take into account other financial commitments and personal circumstances, or fully check the information provided in the application.
In addition, the OFT uncovered evidence that in some cases Swift failed to fully explain the charges that could be incurred if borrowers fell into arrears.
It also did not explore all alternative options before taking borrowers to court.
As a result, the OFT has imposed a set of requirements on Swift. These include carrying out proper assessments of borrowers’ ability to repay the loan without undue hardship, only take steps to repossess a borrower’s home as a last resort, and being transparent about their charges and when they are imposed.
If Swift fails to meet its requirements, the OFT can fine it up to £50,000 and revoke its credit licences.
David Fisher, director of consumer credit at the OFT, said: “Credit businesses must lend responsibly – failure to do so can have a very serious impact on borrowers. We require Swift to significantly improve the way it carries out its business. If they fail to comply with these requirements, they will face further enforcement action.”
