No change in loan’s discrimination by banks

Posted 2007-12-10

The BBC reported that, high street banks still have the right to practice age discrimination in their provision of credit.

The current situation is such that, older people find it rather difficult to obtain credit from banks. This is because the question arises as to whether they will live that long to repay their loans (if given).

In the early part of this year, Mike Young, banking consultant and former Bank of England executive, suggested a change by bringing this discriminaton to an end. This was done in a review.

He recommended that, simply rejecting credit on the basis of age, needed to be changed.

Contrary to this, a British Banking Association (BBA) representative, said that there should be no changes pertaining to this code.

Eric Leenders, Director of Retail Banking at the BBA, is of the opinion, “that banks should have the right to make commercial decisions and consider criteria that they deem as fit. If age is one of the criteria, then so be it.”

In November of this year, Mr. Young’s review of the code was published. In addition to being more mindful of customers, who run a credit risk from banks, he called for clear and concise decisions on issues such as loans and savings account.

However, it met with much criticism by consumer groups who felt that it was not strict enough on certain issues such as bank charges and other such issues, where it needed to be.

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