Definition · Glossary
High-cost short-term credit (HCSTC)
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In plain English
High-cost short-term credit is the FCA's regulatory category for short-term loans with very high interest rates — typically payday loans and similar products. The FCA introduced a price cap on HCSTC to limit costs to borrowers.
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Example
A payday loan charging 1,500% APR falls into the HCSTC category and is subject to FCA price cap rules.
Don't get caught out
Common misunderstandings
- FCA price caps limit what HCSTC lenders can charge — but HCSTC remains among the most expensive forms of credit available.