ABSTRACT
The regulation of high-cost credit in the UK has created significant media and academic attention, especially considering the reviews conducted by both the Competition & Markets Authority (CMA)2 and the UK regulator of consumer credit, the Financial Conduct Authority (FCA).3 Both of these bodies have undertaken significant empirical and statistical investigations of the current high-cost credit market, justifying government intervention on the basis of economic data and findings on the potential harm suffered by borrowers. While this is important research, it has resulted in a lack of philosophical analysis of the current problem. Intervention into the consumer credit market to restrain borrowing inevitably means undermining the rights of those borrowers, namely, their right to freely enter into contracts of their choosing. This means, in addition to the economic rationalisations, philosophical justification is also needed; something which unfortunately is being overlooked in the current law reform process. This chapter aims to fill the current void by providing philosophical justifications for undermining the freedom of contract rights of high-cost credit users, and additionally highlighting the guidance this type of analysis can provide for how the law should respond. There are three sections; Section 1 outlines the high-cost credit situation in the UK, including the borrower profile and the regulatory approach to these issues. Section 2 discusses the general philosophical issues raised by high-cost credit. Section 3 outlines how the law should respond in light of both the profile of highcost credit borrowers provided by the FCA and CMA, and the philosophical justifications for intervention.
