City regulator reviewing whether APRs help consumers understand borrowing costs

There is evidence that APRs do not always allow people to understand the true cost of credit, the FCA said (picture posed by model/Lucy North/PA) - (PA Archive)

Annual percentage rates (APRs), which indicate yearly borrowing costs to consumers, are being reviewed by the City regulator amid evidence that they do not always allow people to understand the true cost of credit.

The Financial Conduct Authority (FCA) is looking into whether APRs help people to understand borrowing costs and is seeking views on whether it should change the way these are communicated in credit advertising.