Emma RadmoreTreasury and FCA have met to discuss the September 2020 report on the regulatory perimeter. Discussions focused on: high risk investments and the potential need to review the current exemptions that allow marketing to...
Category - Consumer Finance
National Courts can order parties to re-negotiate unfair terms, says the CJEU
In Banca B. SA v A.A.A (Case C 269/19) ECLI:EU:C:2020:954 the First Chamber of the Court of Justice of the European Union (CJEU) has held that National Courts can facilitate negotiations to replace an unfair term where...
Scott Nodder
Treasury confirms BNPL regulation “as soon as time allows”
Heralding the publication of the Woolard Review, Treasury published its exchange of letters with Chris Woolard confirming the Economic Secretary’s agreement with the recommendation to regulated interest-free BNPL...
FCA publishes unsecured credit market report
The FCA published the Woolard Review on the unsecured consumer credit market today. The report sets out 26 recommendations on how to make the market better in the future including: bringing BNPL into regulation more...
Caroline StevensonFCA publish latest coronavirus updates
The FCA has today published an update on mortgages, consumer credit, banking and payments during coronavirus. The main points can be summarised as follows: repossessions under mortgages cannot be undertaken without...
FCA publishes BBLS PAYG guidance
FCA has published its finalised guidance for firms that provide Pay as You Grow options under the BBLS. The guidance: notes that CONC 7 generally applies to set out the rules for fair treatment of customers in arrears...
Jonny WilliamsFCA writes to Debt Purchasers, Collectors and Administrators
The FCA has written to Debt Purchasers, Debt Collectors and Debt Administrators outlining: its view of the key risks debt purchase, debt collection and debt administration firms pose to their customers or the markets in...
Angie BamboulisFCA consults on mortgage and consumer credit Covid guidance update
FCA is consulting, until 10:00am on 18 January, on updating its guidance for mortgage and consumer credit borrowers in financial difficulties as a result of Covid. Key proposals are: an extension on the ban on...
FCA publishes Covid resilience survey results
FCA has published the results of the survey it sent to 23,000 forms on the real-time effect the pandemic is having on their resilience. Among its conclusions are: failures of firms due to the economic downturn are...
Insolvency Service Guidance: Breathing Space
The Insolvency Service has published its guidance on the Debt Respite Scheme (Breathing Space). The guidance is intended to support creditors in understanding the Breathing Space Regulations and sets out information on:...
Lucy HadrillFCA updates on complaints data
FCA has published its latest firm-specific and aggregate complaints data from firms for H1 2020. It specifically notes: the lowest levels of recorded complaints since H2 2016 – firms received 2.96m; the largest...
FCA fines over treatment of customers in arrears
FCA has fined 3 entities in the Barclays group £26m for breaches of Principles 3 and 6 relating to failures in relation to their treatment of consumer credit customers who fell into arrears or were otherwise in...
BoE Financial Stability Report
The Bank of England published the Financial Stability Report for December. The report sets out the Financial Policy Committee’s view on the stability of the UK financial system and what it is doing to remove or...
Up next from FCA
FCA’s latest policy development update highlights as due before the end of the year consultation on changes to accommodate the Breathing Space Regulations.
Most other consultations are due in the New Year
FCA pleased with RTO price cap
FCA has published an evaluation, which it says shows its rent-to-own price cap, which took effect in April 2019 has been effective in reducing the prices RTO firms charge. It says the prices of the two largest firms in...
Mainstream Consumer Credit Lenders portfolio letter published
The FCA has today published the letter it sent to the Board of Directors of mainstream Consumer Credit Lenders. The letter sets out the FCA’s: views of the risks these lenders pose to their consumers or the...
FCA makes new rules
FCA’s latest Handbook Notice confirms it has made the following rules at its last 3 board meetings: changes to reflect the extension of various SMCR deadlines as a result of the pandemic (made in October); the...
HM Treasury extends consultation deadlines
Financial Services Future Regulatory Framework Review Phase II Consultation – further to the consultation document published on 19 October 2020, the consultation has been extended by one month to 19 February 2021...
Ombudsman News looks at trends and stats
The latest edition of Ombudsman News looks at its recently published complaints data (previously featured in detail in FIN), which saw a rise in complaints from people who borrowed money and then felt the debt was...
FCA: Covid support for consumer credit
The FCA yesterday published it’s next stage of enhanced support that firms must offer consumer credit customers facing payment difficulties as a result of the COVID-19 pandemic (FS20/18). If you’d like to...
FOS approach to CCA complaints
The FOS has published a website setting out its general approach to complaints about consumer credit products. The website sets out details of the types of complaints the FOS will consider, their approach to reviewing...
Final Breathing Space Regulations published
HM Treasury has today published the final version of the The Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales) Regulations 2020. Get in touch if you’d like...
Covid-19 support update: mortgages
The FCA yesterday announced updated guidance for mortgage customer facing financial difficulties as a result of Covid-19. Under the extension, eligible customers will have until 31 March 2021 to apply for an initial...
FCA writes supervision letter to PCWs
FCA has written a portfolio supervision letter to CEOs of price comparison websites. The letter notes the key priority that customers buying products through PCWs should buy products consistent with their demands and...
Default notices amendment regulations published
HM Treasury has published the Consumer Credit (Enforcement, Default and Termination Notices (Coronavirus) (Amendment) Regulations 2020 which come into force on 2nd December 2020 and firms must have implemented the...
Latest Denizbank ruling on interpretation of PSD2
The First Chamber of the Court of Justice of the EU (CJEU) has made a preliminary ruling in the case of Denizbank AG v Verein fur Konsumenteninformation (Case C-287/19) [ECLI:EU:C:2020:897]. It has clarified the...
Distance marketing of consumer financial services
The EC published a Commission Staff Working Document Evaluation of Directive 2002/65/EC concerning the distance marketing of consumer financial services. The evaluation can be summarised at a high level as follows: The...
FOS publishes Q2 information
FOS has published complaints figures for July – September 2020 (Q2 2020). It: received 69,000 complaints in total received over 5,900 Covid-related complaints referred over 9,000 complaints to an Ombudsman upheld...
Up next from FCA
Before the end of the year, FCA expects to publish:
consultation on amendments to take account of Breathing Space Regulations;
consultation on fees policy; and
feedback on the debt advice levy rate.
FCA updates on EEA regulator Brexit guidance
FCA has put together an information page sharing links to the websites of EEA regulators on which they have published guidance about the effects of Brexit on UK firms operating in their jurisdictions. Some of the pages...
EC report on CCD
The European Commission published a report yesterday to the European Parliament and Council of the EU on the implementation of CCD. The key outcomes of the evaluation fall into the following headings: Effectiveness...
FCA speech: the credit market and the pandemic
Jonathan Davidson, Executive Director of Supervision – Retail and Authorisations at the FCA, has delivered a speech on the FCA’s priorities for the credit market. Stressing that consumer credit remains one of his...
Covid-19 measures weekly summary
It’s been a while since we needed to do a digest of these. In the light of the new English lockdown and the expiry of various measures, the last week has seen: FCA consultation on updated guidance for consumer...
EBA urges consumers first in POG supervision
EBA has published a report encouraging firms to put consumers’ interests first when they are applying product oversight and governance arrangements. It has found this focus is lacking in many firms. This report...
Further Consumer Credit Covid-19 measures announced
The FCA today published a number of updated guidance documents for consumer credit firms who have customers still facing financial difficulties due to COVID-19. The publications sets out details of the enhanced support...
Enhanced Covid support for mortgage customers published
Today, the FCA published draft guidance extending the payment deferral support for mortgage customers up to 31 January 2021. The FCA are expecting comments from stakeholders by 5 November 2020 by emailing...
FCA publish Call for Input: Unsecured Credit Market
This morning, the FCA has published a Call for Input: Review into change and innovation in the unsecured credit market (The Woolard Review). The call for input revolves around, and asks questions specific to, the...
FCA to propose mortgage and consumer credit support update
FCA reacted to the announcement of the further measures to contain Covid-19 by saying it will review its measures to support mortgage borrowers impacted by the pandemic. Although FCA stresses borrowers should always try...
FCA confirms updated guidance for insurance and premium finance
FCA has confirmed its finalised guidance for insurance and premium finance firms, that applies from 31 October. The guidance contains minor changes from the consultation version, and supersedes the August guidance...
FCA writes portfolio letter to mortgage intermediaries
FCA has published its portfolio supervision letter to mortgage intermediaries. It notes that mortgage intermediaries range from sole advisers to large networks, and that most focus on mainstream mortgages but some...
FCA extends deadline for lenders to offer switching options for mortgage prisoners
In 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...
FCA introduces measures to support mortgage borrowers
The FCA has adopted new measures to support closed book and interest-only/ part-and-part mortgage borrowers, some of whom may be mortgage prisoners. The measures are: a new rule that will make it easier for lenders to...
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...
Breathing Space Consultation Launched
The FCA has published its consultation on the handbook changes required as a result of implementation of the Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales)...
HMT 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...
Consumer 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...
FCA 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...