Barclays has lodged an appeal against threatened limits on the sale of the controversial Payment Protection Insurance (PPI).

PPI is supposed to cover loan repayments if the holder is unable to work due to an accident or illness or if they lose their job.

In January the Competition Commission passed a ruling to prevent lenders from selling PPI alongside credit cards, loans and mortgages from October 2010. Instead they must wait seven days before contacting customers to sell them the cover.

In March Barclays lodged an appeal against the ruling, which is currently being heard in court. The bank argued that the ban is not justified by the evidence collected as part of the Competition Commission’s investigation.

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Building Societies say that new regulations proposed by the Financial Services Authority (FSA) will make it difficult for them to compete with High Street banks.

Proposals from the City watchdog include restrictions on riskier types of lending by building societies, such as high loan-to-value mortgages for borrowers with small deposits and by-to-let mortgages. The FSA also wants building societies to employ specialist senior managers to oversee any riskier lending.

The Building Societies Association (BSA) says that the proposals would hinder industry growth. It has made a formal submission to the FSA following a consultation period on the watchdog’s plans.

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The UK scrappage scheme continued to encourage growth in the car industry in August with sales up 6% from a year ago, industry figures show.

The Society of Motor Manufacturers and Traders said 67,006 new cars were sold in August, the second consecutive month of rises. However, total sales since the start of 2009 are still 21.5% lower than the same period last year.

The Society attributed the rise to the scrappage incentive scheme introduced in May, in which drivers who trade in a car over 10 years old receive a £2,000 discount off a new car. Half of the discount is paid by the government and half by the car industry.

The announcement was cautiously welcomed by SMMT chief executive Paul Everitt:

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Complaints about banks have soared in the past two years, reflecting customers’ growing dissatisfaction with poor service and hefty bank charges, the Financial Services Authority (FSA) said today.

FSA figures showed a 122% increase in complaints about banking and loans, from 608,620 in July 2006 to 1.3m in June 2007. This included a 259% increase in complaints about overcharging, and a 71% increase in those about poor customer service.

However, the number of complaints decreased in the second half of 2007 and 2008 following the FSA’s decision to allow banks to postpone dealing with complaints relating to unauthorised overdraft charges until a court case regarding their unfairness is resolved.

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A Nottinghamshire entrepreneur who featured in the Channel 4 series Secret Millionaire has been declared bankrupt.

Property Tycoon Chek Whyte is believed to have debts of around £30 million, and had attempted to make arrangements to continue trading whilst paying off his debts. He was issued with a bankruptcy order following a petition by creditor Halls Furnishings Ltd, which trades as Loft Interiors of Manchester.

The self-made millionaire appeared on the Channel 4 series in 2007 and donated money to a number of good causes in Salford, Greater Manchester.

Whyte made his fortune in the property and construction industry, renovating dilapidated listed buildings such as Colwick Hall and Clifton Hall in Nottingham.

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In a bid to gain an even larger share of the mortgage market, HSBC this morning announced the launch of its cheapest ever home loan - a two-year discount deal with a starting rate of 1.99%.

The Woolwich and Cheltenham & Gloucester have also announced cuts to their fixed-rate mortgages.

HSBC’s discount rate applies to borrowers with a 40% deposit, and is set at a 1.95% discount to the bank’s standard variable rate of 3.94%.The bank was the UK’s largest lender during the first half of the year.

The deposit needed to secure a mortgage has increased sharply over the past year as lenders restrict credit to borrowers. Currently 27% of new mortgage deals require a deposit of 40%, compared with just 7% of deals a year ago. There’s some good news for first time buyers, however, with a slight increase in the 10% deposit tier this year.

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The total amount of personal debt in the UK has fallen for the first on record, according to new figures from the Bank of England. Mortgage repayments also outstripped new lending for the first time since records began in 1993.

Personal borrowing fell by £600m in July with the amount of money owed by individuals totalling £1.457 trillion. There was a decrease in both mortgages and personal loans.

The steep drop in mortgage lending was driven by the ongoing restriction of the amount banks and building societies are prepared to advance, with the British Bankers’ Association admitting last week that net lending in July fell to its lowest level since October 2000.

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The Ministry of Justice has launched a series of online videos and articles aimed at helping homeowners facing possible repossession.

The advice at www.direct.gov.uk includes articles covering the first arrears right up to what happens at a court hearing, as well as guidance for tenants struggling to pay the rent. Click the links to find advice for homeowners and tenants.

“The Government has taken considerable steps to ensure people struggling to pay their rent or mortgage get the help they need to stay in their homes,” said Justice Minister Bridget Prentice.

“Mortgage repossession figures released earlier this month show that the number of people facing repossession has considerably reduced since this time last year, but we’re not complacent.”

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Millions of students and graduates will see interest on their loans drop to zero or lower today following falls in the retail price index.

Whilst the majority of students - those who took out loans after 1998 - will see the interest on their student loans drop to 0%, graduates who commenced study before 1998 will have their new interest rate set at -0.4%, meaning that the amount they owe will have decreased by the end of the 2009/10 academic year, even if they make no repayments.

The interest rate for student loans taken out after 1998 is based on the retail price index, which turned negative for the first time in almost 50 years in March at -0.4%, as the UK’s recession worsened. However, a legal loophole has enabled the government to refrain from setting an interest rate at all on these “income contingent” loans, in effect making the rate 0%.

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