‘Debt advice needs to be good quality and meet the needs of consumers. Too often people who contact debt packagers for help are being given advice that could cause them harm. This is unacceptable, especially as people seeking debt advice are often in vulnerable circumstances.
‘Our proposals will address the inherent conflict of interest present in the debt packager business models. This will help protect consumers who need support managing their debts.’
However, Rob feels the focus should be shifted towards the minority who are taking advantage of vulnerable consumers rather than impeding the entire industry.
He added: ‘All firms, including free-to-use services, should be advancing the interests of the consumer.
‘Unfortunately, we know that does not always happen, but the job of the regulator is to ensure poor practice is weeded out so that the market has consistently high standards.
‘I fear there will be a substantial, unintended impact of banning referral fees.
‘An alternative would be to place greater responsibility and consequences on the firm paying the referral fee to ensure that the advice provided, is in the best interests of the consumer.’