Retail surgery: Is it true that we are no longer going to be able to provide credit at the point of sale in the same way as we have?

The EU’s Consumer Credit Directive was due to be implemented in June this year, and would have harmonised consumer credit legislation across the region. This has now been delayed until next year, but in any case UK retailers have little to fear, as in most regards it is the rest of Europe playing catch-up.

Hitachi Capital Consumer Finance managing director Gerald Grimes, whose company works with retailers including DFS and Wickes, says that any changes to the £2.5bn a year store point-of-sale finance market should not cause UK retailers huge problems. Hitachi Capital Consumer Finance has a working party looking at what is being proposed and says that it continues to be made more workable.

Grimes says: “There is a much bigger job to do if you are a retailer in Portugal or Spain.”

The future legislation will establish a principle of affordability, but Grimes says this is something that UK retailers, with their credit checking, are already very good at.

He adds: “The Office of Fair Trading is already rigorous in how things are presented to the customer.” And the financial services industry in the UK has already adopted the principles of treating customers fairly.

The one area that could cause concern would be the establishment of a cooling-off period for finance. While not a problem in a furniture store, where it is not normal to take goods away immediately, it could cause changes in the sales process for retailers such as jewellers.