Emma RadmoreIn its latest update, the FCA acknowledged that Covid-19 has meant that lenders have not been able to offer switching options for mortgage prisoners as quickly as anticipated. FCA rules require administrators and...
Category - Consumer Finance
Lucy Hadrill
FCA confirms new rules
FCA has issued a Handbook Notice summarising rule changes finalised over recent months. Key among them are: the new section on COBS (22.6) to ban derivatives and ETNs that reference certain cryptoassets to be marketed...
Caroline StevensonHMT consults on financial services regulatory framework post-Brexit
HM Treasury has published a consultation paper in relation to Phase II of its Financial Services Future Regulatory Framework Review. HMT is seeking views on proposals for the financial services regulatory framework post...
FSB issues final report on CIRR toolkit
The Financial Stability Board (FSB) has published its final report on a toolkit of effective practices for financial institutions’ cyber incident response and recovery (CIRR). The toolkit aims to assist financial...
ESRB publishes Recommendation on identifying legal entities
The European Systemic Risk Board (ESRB)’s Recommendation A proposes that: EU legislation incorporates a common EU legal framework governing the identification of legal entities established in the EU that are...
Lords responds to HMT on equivalence
Baroness Donaghy, chair of the House of Lords EU Services Sub-Committee, has responded to HMT’s letter of 21 September which set out the Government’s responses to previous queries of the Sub-Committee on UK...
Speech: FCA Regulation of Consumer Credit
Nisha Arora, Director of Consumer and Retail Policy at the FCA gave a speech today at the online Finance and Leasing Association Conference. The speech reminded the audience about the 4 outcomes the FCA wants to see for...
Mortgage Market Disruptions
The FCA today published Occasional Paper No. 57 on mortgage market disruptions. The paper uses data to document the trends associated with COVID-19 and compares them to the financial crisis of 2007-09. The summary...
HMT writes to House of Lords on equivalence
The Economic Secretary to HM Treasury, John Glen MP, has responded to the House of Lords EU Services Sub-Committee’s queries on UK-EU regulatory cooperation for UK financial services post-Brexit. In its letter to...
FCA sets mortgage consumer outcome expectations
Jonathan Davidson, speaking at FCA’s webinar on mortgage forbearance, discussed what FCA is seeing the mortgage markets and reiterated its expectations on firms. His key takeaways were: FCA sees an increasing...
New Debt Letter Rules
HM Treasury has announced this morning that the current form of debt letters, including default notices will be changed from December 2020. The changes are expected to include making the notices more user friendly, with...
FCA skilled persons reports update
In July – September 2020, FCA commissioned 14 skilled persons reports – of which half were on the retail side and half the wholesale side. 3 related to retail banking and payments and 2 to retail lending...
Up next from FCA
FCA’s latest Policy Development Update promises, by the end of the calendar year: consultation on amendments to CONC and MCOB to accommodate the Breathing Space Regulations consultation on the new regulatory...
Finalised Guidance: Cancellations and refunds
Following our report on the draft guidance published on 31 July, the FCA has published its finalised guidance on its expectations for insurance and card providers helping consumers claim money back. The guidance which...
PRA consults on IRB approach to UK mortgage risk weights
PRA is consulting on rule changes to address the prudential risks that stem from inappropriately low IRB mortgage risk weights. A by-product of the proposals would also narrow the differentials between IRB and...
Jonny WilliamsConsumer Credit and Coronavirus: Final FCA Guidance
Further to the draft guidance which we wrote about on the 16th, the FCA has today published its finalised guidance which is to take effect from 2nd October. The guidance, which covers credit cards, loans, rent to own...
FCA reports on regulatory perimeter
FCA has published its second report on the regulatory perimeter. The report looks at: consumer confusion about the perimeter – and when FCA has the power to act. It also notes that customers may be confused as to...
Regulatory Initiatives Grid heralds return to “normality”
FCA has published the second edition of the Financial Services Regulatory Initiatives Forum’s Regulatory Initiatives Grid. The grid, first published in May, is aimed to help firms see upcoming regulatory work...
Chair announced for Unsecured Credit Market review
The FCA has today announced that Chris Woolard will chair a review of the future regulation of the unsecured credit market. The Review, set to be published by early 2021, will look at regulation’s role in better...
Consumer Credit and Coronavirus (Additional Guidance for Firms)
The FCA has published the additional guidance for consumer credit firms on the next stage of help for consumers. The guidance covers credit cards, loans, rent to own, BNPL, pawnbroking, motor finance and HCST. The FCA...
PSR publishes interim report on card acquiring services
PSR has published its interim report with provisional findings on the supply of card-acquiring services. It says merchants should shop around to get a better deal from their provider or switch to a new one, but that...
FCA confirms new mortgages guidance
FCA has finalised its additional guidance to firms in the mortgage markets, setting out how they should provide tailored support to borrowers who have had payment deferrals but continue to struggle, and to those whose...
Up next from FCA
The latest Policy Development Update notes a reinvigoration of FCA in publishing consultation and discussion papers before the end of the calendar year. It plans: consultation on amendments to accommodate the Breathing...
UK Finance backs FCA mortgage plans
UK Finance is supportive of FCA’s plans for additional guidance to firms on mortgages and COVID-19. It says the industry has always said it is better fora customer who can afford payments to continue to make...
COVID 19: Mortgage Consultation
The FCA has published its supplementary guidance note which sets out its expectations of firms dealing with mortgage customers who: are unable to resume payments after 2 payment deferrals; have benefitted from an...
FOS focuses on Covid-19 complaints
The latest edition of Ombudsman News focuses on complaints arising from Covid-19 and its impact on consumers and SMEs. FOS notes that some of the issues are new, but others are common issues made worse by the pandemic...
UK Finance data shows consumers paid down credit card bills during lockdown
New data released by UK Finance reveals that outstanding balances on credit cards contracted by 12.6 per cent in the year to May, as cardholders used the lockdown to pay down bills. May also saw credit card spending by...
Amelia GreenFCA publishes high cost credit review
FCA has published the findings of a review into relending by firms that offer high cost credit. It carried out the review before the current pandemic. The results highlight concerns about poor practices by some firms...
FCA consults on debt advice levy rates
FCA is consulting on additional funding by way of debt levy advice rates. The DWP has told it that an additional £14.2m for MaPS to provide debt advice in England in 2020/21. Treasury has also asked for a further £2...
FCA consults on consumer refund guidance
FCA has published a guidance consultation on how firms should be helping customers with rights and routes to refunds. The guidance builds on FCA’s previous statements on consumers’ rights when their trips...
FCA calls for views on consumer treatment at end of deferral period
FCA has published a call for input, seeking views on what should happen to mortgage and consumer credit customers reaching the end of a second payment deferral (these will be ending from September onwards). It also asks...
FCA Guide: Prepare Your Firm for Brexit
The Brexit transition period is currently operating until 31 December 2020. The FCA have produced a list of key considerations to help firms consider how they will be impacted by this and what action they may need to...
Andrew Graham-SmithFCA to Ban Motor Finance Discretionary Commission Models
The FCA has announced that it will introduce a ban on discretionary commission models following a consultation in October 2019. As background, some car retailers and motor finance brokers receive commission which is...
FCA updates on sandbox
FCA has announced its acceptance of 22 businesses into cohort 6 of its sandbox. It had received 68 applications, mainly from the retail banking, payments and retail lending sectors. More than half were seeking to...
FCA publishes debt advice portfolio strategy letter
FCA has written a portfolio letter to debt advice firms. The letter follows the usual format of setting out key risks and regulatory expectations, and explaining FCA’s supervisory strategy. It considers the key...
FCA publishes Intergenerational differences summary
The FCA has today published feedback statement FS20/12 summarising the responses and next steps following discussion paper DP19/2 on intergenerational differences. The paper summarises the average financial...
Court rules “No DSS” unlawful under the Equality Act
York County Court has ruled that so called “no DSS” policies – which put in place a ban on renting property to people who are on housing benefit – are discriminatory and unlawful under the...
Regulation round up highlights refunds, SMRC delays and next steps in Covid-19 consumer protection
FCA’s latest Regulation Round up covers the usual update of FCA’s recent publications, and reminds them of some earlier, still relevant, statements, not least: the confirmed new guidance for motor finance...
FCA clarifies latest COVID-19 rules for motor finance, BNPL, RTO, HCSTC & Pawnbroking
Following the consultation at the start of July, the FCA has today clarified the latest rules for how firms should deal with motor finance, BNPL, TRO and pawnbroking customers coming to the end of payment freezes. These...
COJ Rulings on Unfair Contract Terms in Consumer Credit Agreements
The following are summaries of two recent Court of Justice of the European Union judgements. Both concern interpretation of the unfair contract terms provisions found in Council Directive 93/13/EEC as concern terms of...
Up next from FCA
Over the rest of 2020, FCA plans the following: consultations on mortgage borrowing and mortgage prisoners (now overdue), debt advice levy rates and exist fees in investment platforms (Summer 2020) and on financial...
FCA consults on extension of motor finance and high cost credit reliefs
FCA is consulting on proposals for how firms should deal with motor finance, BNPL, RTO and pawnbroking customers coming to the end of payment freezes, or who are yet to request them. The guidance is very similar to the...
Consumer Panel mulls digital advertising
The Financial Services Consumer Panel has published a discussion paper on digital advertising in financial services. It is deeply concerned about the use of “adtech” to create detailed profiles of...
Covid 19 – FCA confirms additional support for consumer credit customers
The FCA has today (1st July 2020) confirmed the new guidance for firms on how they treat consumer credit customers who are still experiencing financial difficulties due to Covid-19. The new guidance comes in to force on...
Natasha BrownleeEuropean Commission consults on consumer credit agreements
The European Commission is consulting, as part of its review of EU consumer policy, on the Consumer Credit Directive. It wants to review the Directive in light of the recent evaluation which highlighted a number of...
Barnier speaks on Brexit
Michel Barnier has spoken at the Eurofi General Assembly on UK/EU relations. He noted the desire to give the EU/UK negotiations “every chance of succeeding”. He noted he had rescheduled many other meetings...
FCA updates on Covid-19 delayed activities
FCA has confirmed some further delays to projects and extensions to proposed deadlines, in light of Covid-19. Various deadlines now postponed until later in 2020-or to 2021 include: The Directory of Certified Persons...
FCA Update on Mortgage Prisoners
The FCA has updated their webpage relating to the implementation group on changes to deliver switching options for mortgage prisoners. The update includes details of a meeting held on 1st May 2020 which confirmed that...
European review of Consumer Credit Legislation
The European Commission published a roadmap looking at reviewing the European Consumer Credit Directive. The feedback period for the roadmap is open from today until 1 September 2020. The review focuses on the following...
FCA Publishes COVID-19 guidance for loan providers
The FCA published its draft guidance clarifying the continued treatment of customers experiencing temporary financial hardship due to COVID-19. The FCA is welcoming comments on the proposals until 5pm on 22 June 2020...
FCA updates COVID-19 guidance for overdraft providers
The FCA has, this morning, published its draft guidance clarifying the continued treatment of customers experiencing temporary financial hardship due to COVID-19. The FCA is welcoming comments on the proposals until...
Covid-19: EP eases rules to encourage lending to companies and households
Members of the European Parliament (“MEPs“) have approved more flexibility in EU banks’ prudential rulebook to focus on lending to the Covid-19-stricken economy. Aiming to strike a balance between a robust...
FCA updates COVID-19 guidance for credit card providers
The FCA has, this morning, published its draft guidance clarifying the continued treatment of customers experiencing temporary financial hardship due to COVID-19. The FCA is welcoming comments on the proposals until...
EBA extends payment moratoria deadline
EBA will extend the application date of its guidelines on payment moratoria to 30 September, as economies gradually re-open. It says the extension will ensure that adequate treatment for borrowers is available across...
FCA updates mortgages Covid-19 page
FCA has updated its website on its finalised guidance for firms on mortgages and Covid-19. The updates are minor, making a few clarifications only, mainly to confirm that firms that could not provide personalised...
Identity of lenders in peer-to-peer lending platform protected by Chancery Appeals Court
In Andrew Milne v Open Access Finance Ltd [2020] EWHC 1420 (Ch) the Court rejected an appeal against the making of a representative order under CPR r. 19.6 but allowed the appeal challenging the identity of that...
Scott NodderFCA publishes equity release review
FCA has published the results of its review into how the equity release market is working for consumers. The review found that equity release can be an attractive option for some consumers, and that it is working well...
Randell speaks on supporting the recovery
Charles Randell has spoken to a virtual roundtable of bank chairs on how the financial services industry can work to support recovery from the Covid-19 pandemic. He noted the great efforts that banks and other market...
FCA fines £64m for mortgage arrears handling failures
FCA has fined Lloyds Bank, Bank of Scotland and the Mortgage Business £64,046,800 for failures in relation to handling of mortgage customers in payment difficulties or arrears between April 2011 and December 2015. The...
£38m support for debt advice
The Government has announced a nearly £38m support package for debt advice providers, to help them to provide essential services to people who have struggled with their finances because of Covid-19. The Money and...
FCA publishes Covid-19 guidance for SMEs
FCA has added to its suite of guidance on Covid-19 issues with a pages setting out help available to SMEs. The guidance explains what BBLS and CBILS do, and explains the guidance FCA has given to banks and insurers on...
EVENT: Retail Banking Mixer Webinar
Our next r=Retail Banking Mixer will be held by webinar on 18th June at 10am. We are delighted to be joined by Rosemary Ford and Amber Andrade from Deloitte this time. The webinar continues the focus on COVID-19. Our...
FOS publishes 2019/20 data
FOS has published details of the complaints it received and dealt with in 2019/2020. It received around 270,000 complaints and dealt with nearly 300,000, with the Ombudsman making nearly 30,000 decisions. As ever, the...
Compulsory FCA survey coming to firms
FCA is to send a survey by email with a link to 13,000 solo regulated firms, aimed to helping FCA understand the impact of Covid 19 on regulated firms and their financial resilience, where the greatest impacts are for...
UK Finance reports payment holiday figures
UK Finance statistics show that, as of 21 May, their members report that: 877,800 customer accounts had been given a payment freeze on their credit cards, an increase of 25% from the start of the month; nearly 680,000...
PRA publishes FAQs on property valuations
PRA has published a set of Q&A on CRR requirements for property valuations during the disruption caused by Covid-19. Firms have been asking questions on how they shoudl deal with the difficulties in conducting...
UK Finance comments on FCA mortgage proposals
UK Finance has responded to FCA’s consultation on what firms should be doing as the next stage of helping customers in financial difficulties due to Covid-19 with their mortgages. While, of course, UK...
Regulator Covid-19 update 22 May
After a relatively quiet week, on 22 May: FCA announced further support for customers struggling to pay mortgages due to Covid-19. It is consulting on what options firms will need to provide to customers reaching the...
Government publishes draft EU/UK FTA
The Government has published a draft Comprehensive Free Trade Agreement between the UK and EU. Chapter 17 of the agreement relates to financial services, which it defines as “any service of a financial nature...
PRA responds on retirement interest-only mortgages and default
PRA has provided its feedback following responses to its consultation on prudential treatment of retirement interest-only mortgages, and on credit risk: probability of default and loss given default estimation. Tt has...
FCA updates on Covid-19 and complaints
FCA has updated its webpage on how firms should be handling consumers’ complaints during Covid-19. The page explains that FCA has asked firms to prioritise making payments where consumers have accepted offers or...
FCA gives lending application guidance
FCA has updated its webpages giving guidance to applicants for authorisation, The latest updated page includes a sample business plan for consumer credit business, with guidance for different types of firms, and...
FCA sets out planned initiatives
FCA has published a grid prepared by the Financial Services Regulatory Initiatives Forum setting out the regulatory pipeline for the next 12 months. The forum comprises FCA, PRA, BoE, the PSR and the CMA, with Treasury...
Government sets out equivalence views
John Glen has written to the Chair of the European Scrutiny Committee explaining the Government’s stance on equivalence in financial services. The Government cannot provide great detail given the early stage of...
FCA updates on CBILS and BBLS expectations
On 4 May: FCA updated its statement about the CBILS and BBLS confirming that its position that lenders who comply with CBILS do not also have to comply with the creditworthiness rules in CONC 5.2A.4-34 where the...
Regulator Covid-19 update 1 May
On 1 May, FCA: announced proposals for a Court declaration on business interruption claims proposed guidance for insurers on assessing whether products still offer value and appropriate action to take where they do not...
FCA publishes skilled person data
FCA has publicised the number of skilled persons reports commissioned in January to March 2020. It commissioned 24 in total, of which 9 related to retail banking and 6 to retail lending. 6 of the reports were on...
Tribunal rules against FCA on cancellation decision
The Tribunal has ruled on a case brought by Financial Services (Euro) Ltd against FCA. FCA had decided to cancel the firm’s permission because it had no PII cover. The firm contended that FCA was aware that the...
FCA confirms more temporary relief measures
As expected, FCA has confirmed it will be going ahead with the measures it has consulted on to support customers facing difficulties in making payments on motor finance, buy-no-pay-later, rent-to-own and pawnbroking...
Regulator Covid-19 update 22 April
On 22 April FCA published a new webpage on PII cover for financial advisers. It recognises that firms may be concerned about their ability to renew their PII during the Covid-19 crisis, which may impact on their...
CMA writes to Metro Bank on breaches of the Retail Banking Order
The CMA has written to Metro Bank’s CEO after the bank broke an Order requiring it to send customers text alerts before charging them for going into an unarranged overdraft, giving them time to act and...
Covid-19: Draft temporary guidance on rent-to-own, buy-now pay-later and pawnbroking agreements
The FCA published draft guidance for regulated firms that enter into rent-to-own (“RTO“), buy-now pay-later (“BNPL“) (as defined in the FCA Handbook), or pawnbroking agreements today. The...
Covid-19: Draft temporary guidance on HCSTC
Today, the FCA published draft guidance for regulated firms that enter into high-cost short-term credit (“HCSTC“) loans, including payday loans. The guidance also applies to firms that have acquired such...
FCA publishes complaints figures for H2 2019
The FCA has today published the complaints figures for regulated firms for the second half of 2019. The data showed an increase in complaints from 4.29m in the first half of 2019 to 6.02m in the second half of 2019. In...
FOS updates on Covid-19 activities
The latest edition of Ombudsman News focuses on: how it is working to help complainants during the Covid-19 crisis, including on how it has changed its helpline hours – for which it apologises but asks that it...
Personal Loans and Coronavirus: New Rules
As noted earlier, the FCA has published the new rules that firms require to implement by 14 April 2020. Who does the rules apply to? It applies to all personal loan customers who are already experiencing or reasonably...
Personal Credit Cards and Coronavirus: New Rules
As noted earlier, the FCA has published the new rules that firms require to implement by 14 April 2020. Who does the rules apply to? It applies to all credit card customers who are already experiencing or reasonably...
FCA confirms new measures for retail banking customers
Following the emergency consultation launched last week, this morning, the FCA has confirmed the range of temporary relief that must be implemented by firms by 14 April at the latest. The new rules require that, where...
FCA consults on fees
FCA has published its fees and levies proposals for 2020/2021. Covid-19 has affected FCA’s plans, and it is taking action to protect small and medium sized firms from the burden of regulatory fees. Comments are...
FCA Business Plan 20/21
The FCA published its business plan for the coming year this morning. The plan focuses around 5 key priorities for the year. It has been significantly reshaped because of coronavirus as it was intended to show the...
Regulator Covid-19 update 3 April
On 3 April: PRA and FCA updated dual-regulated firms on how their should deal with furloughing and compliance with the SMCR; EBA published guidelines on the criteria for public and private moratoria applied before 30...
Regulator Covid-19 Update 2 April
On 2 April, the main regulatory initiative was FCA’s emergency consultation on consumer protection measures in the regulated lending markets. Also: PRA and Treasury confirmed the delay of Basel 3.1 by one year...
Parliament Committee seeks equivalence answers
The Third Report of Session of the House of Commons European Scrutiny Committee seeks clarification on the Government’s intentions for negotiations of equivalence arrangements with the EU from the end of the...
FOS confirms case fees and releases 2020/21 budget
FCA has confirmed FOS’ 2020/21 budget. Key elements include: continuing to allow 25 “fee” cases for firms outside the group account fee arrangement – so 90% of firms will pay no case fees; 50...
In-action is a breach of duty and amounts to concealment for Limitation defences
In Canada Square Operations Ltd v Mrs Beverley Potter [2020] EWHC 672 (QB) , the High Court heard an appeal by the creditor against the decision of Mr Recorder Rosen QC. In the decision it was found that the creditor...
FCA updates mortgage firm Covid-19 guidance
FCA had provided additional guidance to mortgage firms on payment holidays relating to Covid-19. We reported in this post on the original guidance. FCA has previously required firms to offer payment holidays if they...
Regulator Covid-19 Update 26 March
On 26 March: FCA, while confirming its intention to be flexible to allow firms to keep operating, noted that they should also be planning ahead and ensuring sound management of their financial resources. It says buffers...
Government confirms extension of TTP
In a statement to Parliament, Lord Agnew of Oulton, the Minister of State, has noted a statement from Treasury that it expects “in general” the same laws and rules to apply as the transition period ends, it...
Contactless limit increasing
UK Finance announced today that the card transactional contactless limit will be increasing from £30 to £45 with the roll out starting on 1 April. The changes may take a while for retailers to implement, especially...
FOS looks at insurance coverage
FOS’s latest Ombudsman News looks at: coronavirus: so far, FOS has not seen many complaints on the impact of the virus, but expects it will see more complaints particularly in relation to travel insurance, medical...
Invalidly executed deeds of guarantee still enforceable
In Signature Living Hotel Ltd v Sulyok [2020] EWHC 257 (Ch), the High Court was asked to consider whether two deeds of guarantee were enforceable in circumstances where the signature of the director of the surety had...
Bank of England slashes interest rate in response to Covid-19
The Bank of England (“BoE”) has reduced the Bank Rate by 50 basis points to 0.25%. The aim of the reduction is to help support business and consumer confidence amidst the Covid-19 outbreak, to bolster the...
Rachael PrestonFCA publishes mortgage switching research
FCA has released its latest report on mortgage switching, from which it concludes there is a case for intervening to help customers who do not switch. It has found that the reasons people have for not switching...