We are always interested in hearing from Andrew Griffith, Economic Secretary to the Treasury. He is also referred to as the city minister because financial services fall within his area of responsibility. So when he spoke at the Mansion House about Financial Literacy and Inclusion, it was good to hear him talking about the importance of access to credit.

It was even better that he recognised the role that the Government and regulators have in the supply of credit. We talk to many investors, especially international ones, concerned about what is happening with UK FS regulation.

We agree fully that the best intentions can lead to regulations that will increase financial inclusion. His reference to the problems with affordability is one that we welcome.

Affordability was a bad experience for many lenders.

Affordability is an excellent example of a regulatory obsession that has gone off track. Unfortunately, arrears and defaults are part of lending, at the core is an understanding of risk. These happen when people encounter the unexpected, the loss of a job, a boiler breaking down an illness without sick pay. No affordability test will prevent these from causing problems for a borrower.

Many people live with the cost of credit, adapt to their position, pull back from some expenditures at times, and look for new ways to bring in income like working an additional shift. Over the last few years, we have seen the development of a model that does not take this into consideration.

So what we have seen is the exiting of many firms from the market due to regulatory issues, along the lines set out by Mr Griffith.

More than a million people use illegal lenders in the UK.

This fall in access to credit is not without consequence, elsewhere organisations like the Centre for Social Justice are telling us that over a million people in England are using illegal lenders.

We are happy to play our part in attempting to tackle the growth of illegal lending, and it was not that long ago that we sought to create stronger connections between our members and the illegal money lending teams. Including carrying a piece in our CCTA magazine and running a workshop for our members.

Later Mr Griffith refers to a return to the concept of “caveat emptor” or buyer beware. That is certainly not the direction the FCA has been moving in recent years. Increasingly the responsibility rests with the lender and away from the borrower.

Consumer Duty is the most explicit demonstration of this, as the responsibility for a good outcome sits with the lender. The customer really is a passenger on this journey. We could get into a much longer discussion about “agency”, but that is for another day.

But there is agreement.

To end on a positive note, everyone agrees that we should do more to increase financial literacy. We need everyone to understand more about the options available to them, the benefits and the consequences if things go wrong.

The CCTA will always be interested in getting involved and playing its part in financial literacy campaigns.