The regulation of consumer credit remains a priority for the FCA both in relation to the outstanding work which needs to be undertaken to replicate some of the original CCA provisions which remain in force, and where the regulator has identified actual or potential consumer detriment.

Retained provisions of the Consumer Credit Act:

As part of the transfer of regulation, Parliament repealed some provisions of the Consumer Credit Act 1974 and some of these were replaced by FCA rules.  The FCA was required to undertake a review in relation to the remaining CCA provisions and to report on this to the Treasury by 1 April 2019, including any recommendations for change.

Review of the High Cost Short Term Credit price cap

The FCA is review the HCSTC price cap that came into force in January 2015, looking specifically at whether consumers excluded from credit as a result of the price cap are turning to illegal money lenders. The results of the price-cap review and information on further work identified as a result of the other issues covered by this Call for Input will be published in mid-2017.

Proposed rules on persistent credit card debt

Following their 2016 credit card market study, the FCA identified further concerns about the scale and persistent nature of some customers’ credit card debt and firms’ lack of incentive to tackle it.  In April 2017 the regulator published a Consultation Paper which proposes a way forward on persistent debt, including earlier identification of customers at risk of financial difficulty and requirements about the interventions which firms must make.

How we can help

Bovill have worked with a wide range of consumer credit firms, ranging from banks to brewery companies, payday lenders to technology companies and rent-to-own firms to estate agencies.   We can help with FCA authorisations, regulatory gap analyses and health checks, regulatory training and other regulatory change projects.  Give Prem Griffith a call to discuss on 0207 620 8454.

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