Mental health charity calls for FCA crackdown on store credit as people with mental health problems twice as likely to be behind with payments

New research from the Money and Mental Health Policy Institute has revealed for the first time the harm being caused to vulnerable customers by confusing credit deals pushed by retailers at the point of sale.

From store cards to catalogue credit, hire-purchase or even car loans, offering credit at the point of sale is a well-recognised technique to increase sales – and it can offer customers a helpful way to spread the cost of large purchases. But these kinds of credit, sold at the checkout, or offered with a discount when you ‘open an account today’, can be hard to resist, and complicated to understand. Today’s research highlights the significant harm they are causing to vulnerable consumers in particular. The research found:

  • People with mental health problems are more likely to say they’ve taken out credit at the point of sale (39% compared to 32% of people without mental health problems)
  • And they’re twice as likely to end up in financial difficulty because of it – 16% of people with mental health problems report being behind on payments on this sort of credit, compared to just 7% of people without mental health problems.
  • A quarter of people with mental health problems say they’ve spent more than they can afford because they could get credit at the point of sale (25% compared to 17%)
  • And the same proportion (25%) said they have impulse-bought products that they didn’t really need because they could pay later, compared to just 14% of people without mental health problems.

Recent research by the policy institute found that people with mental health problems can often find it harder to resist impulses – making emails offering ‘buy now, pay later’ deals or discounts when you take out a store card much harder to resist. The research also found that it can be harder to understand complex information in a period of poor mental health, making offers that combine the cost of the purchase with interest, mandatory insurance, installation and more, very difficult to understand.

The Financial Conduct Authority (FCA) has taken action on other forms of high-cost credit, and the charity is now calling for them to:


  • Ban discounts on purchases offered where point of sale credit is taken out
  • Clarify pricing and sales procedures for credit agreements made at the point of sale
  • Consider capping the cost of point-of-sale credit to help vulnerable customers.


Commenting, Polly Mackenzie, Director of the Money and Mental Health Policy Institute, said:

“The market for this sort of credit, offered to customers when they’re in a shop or browsing online, is heavily weighted in the favour of the creditors – and it’s causing real harm. Customers are encouraged to take out complex new credit deals on the spur of the moment, at the front of a queue in a shop or in a few clicks at an online checkout. For people with mental health problems in particular this is leading to real financial difficulty, encouraging impulsive spending that can be a symptom of a number of mental health problems, and setting people up in credit arrangements that they often don’t fully understand.”



Full policy briefing available at from 00:01 21/5/2017.

Embargoed copies available on request.

Contact: Helen Undy, 07827917829, [email protected] for all media enquiries including interviews with spokespeople.


Notes to Editors

  • The Money and Mental Health Policy Institute was set up by Martin Lewis in spring 2016, registered charity number 1166493.
  • It conducts research and develops policies for banks, lenders, regulators, the health service and government to help people with mental health problems protect themselves from financial difficulties and get out of debt.
  • Martin Lewis OBE, Money Saving Expert, is an award-winning campaigning broadcaster, newspaper columnist and author. He founded in 2003 for £100 and remains its full-time Editor-in- Chief. It is now the UK’s biggest money site, with more than 14 million monthly users. Martin has his own prime-time ITV programme – The Martin Lewis Money Show – and is resident expert on This Morning, Good Morning Britain and BBC Radio 5 Live’s Consumer Panel, among others.
  • Polly Mackenzie is the Director of the Money and Mental Health Policy Institute. She was previously Director of Policy for the Deputy Prime Minister, working in Number 10 and the Cabinet Office, from 2010-2015.

Figures in this release are drawn from a representative survey of 2051 people conducted online by Populus on behalf of the Money and Mental Health Policy Institute between 9th and 11th December 2016. Data was weighted to be nationally representative. Populus is a member of the British Polling Council and abides by its rules; for more information