Poder calorífico, IHL y azufre 85 

In terms of the benefits of the proposed regulatory package, for the purposes of the CBA we took a largely qualitative approach due to inherent difficulties in estimating the potential scale and exact value of benefits. The impacts of the responsible lending proposals are covered in the FCA’s CBA. Our analysis, based on the information we obtained from lenders, brokers and customers, as well as based on economic insights in to the market suggests that, for the ESIS:

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as a result of the proposed regulations relating to disclosure of information via the ESIS, there may be benefits from the improved provision of information to consumers, enabling them to make better-informed decisions about borrowing. This could also drive greater competition in the market if consumers use the information to seek out and compare products. However, there were some reservations as to how much this would benefit consumers due to behavioural biases in the market, the currently level of availability of information and the fact 66 _{FLA estimates that approximately 84% of the second charge lending market is covered by ‘large lenders’ as defined in this} analysis. 0% 20% 40% 60% 80% 100% 120% Before change in

regulation After change in regulation

P ropor tion of pr e- ch an ge re ve nu e Large lenders

Profit Costs Revenue

0% 20% 40% 60% 80% 100% 120% Before change in

regulation After change in regulation

Smaller lenders

Profit Loss Costs Revenue

“The amount of time and efforts to meet FCA requirements outweighs the profitability if you are smaller.”

Lender

“We would be concerned about anything from a regulatory point of view that puts greater relative burden on us than larger firms.”

that the limited customers we interviewed suggested that they had already received helpful and understandable information.

For other areas, our analysis suggests that:

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there could be a potential lowering of costs to consumers if they enter arrears as a result of cost reflective arrears charges. Although the majority of respondents indicated that they already have systems in place to demonstrate that charges are cost reflective, the more prescriptive proposed regulations than those already in place should help to ensure that the benefits are realised for all customers;

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arrears management processes under the FCA’s proposed regulations would also benefit the large proportion of customers going in to arrears by ensuring that greater forbearance measures are taken than observed in the market at present. The proposed regulations should benefit customers by ensuring that those in arrears are supported and helped to manage this effectively before any potential repossession action is taken and/or high arrears charges incurred. Further benefits will also arise from cost savings to borrowers from reduced direct debit reprocessing changes and proposed requirements to improve the sharing of information between first and second charge lenders at the point of commencing litigation action. Our quantification suggests that these may be small: in the region of £30 per loan67_{. This is low} given the existing practices of lenders in relation to direct debit payments and the very small proportion of repossessions compared to total loans;

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charges disclosure may improve not only the provision of information to borrowers, but also competition in charges;

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there may be improved transparency on post contractual fees resulting in customers being able to make better informed decisions. However, the balance between those customers that may pay higher and lower Early Redemption Charges (ERCs) when they are calculated based on costs is unclear and will depend on the extent to which lenders choose to levy ERCs going forward;

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the knowledge and competency proposal for sales staff, specifically the Level 3 qualification requirements, coupled with the proposed move to advised (and execution only) sales for second charge firms may improve the quality of information and advice given to potential borrowers to help them better understand the product being offered, its risks and the potential alternatives. This, along with the suitability tests and responsible lending regulations are likely to help mitigate the risk of customers suffering detriment from taking out second charge loans where this is not appropriate for them;

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the proposed requirement for lenders to take reasonable steps to ensure payments are made directly to previous creditors (e.g. by making cheques payable to them) where debts are being consolidated may yield some benefits by ensuring that the money is used for the intended purpose, counteracting behavioural biases that may result in borrowers making poor choices, and helping to facilitate payments being made promptly without further costs being incurred. However, evidence suggests that the majority of lenders already adopt this practice;

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more information-rich advertisements as a result of the proposed advertising requirements may allow more information up front to be gathered by the consumer to improve their decision making. However, much of the evidence suggests that much of the business now originates from price comparison websites. It is therefore unlikely that traditional advertising regulation will have a large impact on the majority of consumers; and

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the data reporting requirements should help to support the realisation of benefits from the other proposed regulations by increasing compliance and ensuring that the FCA is able to effectively monitor firms’ behaviour and market outcomes to ensure that the regulation is fit for purpose.

8.4

Potential impacts on competition of the proposed regulatory

In document Aprovechamiento de coque de petróleo como aditivo en la producción de coque siderúrgico (página 85-91)