Reccomended extra payments.

[ukracer]

What's all this garbage in aid of?
"As you may know, the Financial Conduct Authority requires us to look after our customers’ accounts by paying attention to how quickly they repay what they borrow."

Extra 180 quid is being taken by auto increased payments.
How is that going to help anyone? All that's going to happen is their credit rating is going to plummet when some payments bounce.
Reducing credit ratings and making borrowing more expensive.

BUT I am wondering if that's what it's really all about.?

 

[skotl]

That sounds very odd. Most credit agreements have fixed payments so a) it seems counter-intuitive to "offer" a product that doesn't do this and b) any company that increased payments in excess of the original agreed amount wouldn't have a leg to stand on.

It would be good to know the background or further context to this. Oh wait... is this for a credit card or similar "flexible" repayment scheme? If so it might be about companies not allowing people to continue to pay a relatively small minimum payment for a long time, e.g. £5 a month on a £1,000 debt for year after year.
If it's that then, to be honest, I could see why the FCA would be taking an interest as that's a situation I found myself in many, many years ago with a couple of credit cards that I maxed out and then just paid the minimum payment for years. There's no way I should have been offered more credit at that time, but I was*.

(*did sort it out eventually but it did take years, literally)

 

[atomant48]

Picking up on Skotl’s first point agreed - I had a letter a few weeks back from one of my mortgages to say they had changed their system and my payments were changing (only by 1.50 a month or so but that’s not the point). 30 mins on the phone with the customer “help” and i was still none the wiser although he repeatedly assured me I wasn’t paying anymore …. even though my payments are going up. I wait with ‘interest’ the letter they have promised which demystifies it all.

but reading the first bit of the OP - it does seem they have identified a very long repayment period (like only making the minimum payment each month) and are trying to help out but get your point if the moneys not available to make the repayment it will just spiral. You have to be really really careful with the numbers but if interest is racking up a balance transfer from somewhere might be a possible route - but you would absolutely have to use the money you’re saving in interest to hammer the balance.

oh and don’t take any financial advice from someone like me !!!