Caroline StevensonThe FCA has issued its latest ‘Dear CEO‘ letter, this time to CMCs in relation to PPI complaints. The FCA has recognised that lenders are facing very significant operational challenges in being able to deal...
Category - Consumer Credit
Scott Nodder
Roseyna JahangirFCA updates on consultations and feedback
The latest Policy Development Update highlights a number of papers due before the end of 2019: feedback on the investment platforms market study remedies; policy proposals on regulatory fees and levies; permitted links...
Emma Radmore
FCA updates skilled persons statistics
FCA has released the figures for skilled persons reports it commissioned in Q1 2019/20. It commissioned 9 reports in total – of which 3 related to each of retail lending and wholesale financial markets, 2 to...
Up next from FCA
The latest version of FCA’s Policy Development Update highlights: expected feedback on Investment Platforms Market Study Remedies by the end of the year; potential policy statement on general insurance value...
FOS has updated its consumer credit resources
The updates published on 1st August 2019 relate to unaffordable lending and guarantor loans. The resources provide details of the types of complaints the FOS tend to deal with and include details about how they assess...
The Government responds to the Treasury Committee Report on Consumers’ Access to Financial Services
The Government’s response to the Treasury Committee report was published on 11th July. The document sets out the Government’s response to each of the report’s conclusions and recommendations. The key...
BEIS review of Consumer Contracts (Information, Cancellation and Additional Charges) Regulations
The Department of Business, Energy and Industrial Strategy has completed its 5 year review of the Consumer Contracts Regulations. While these regulations broadly exclude financial services, they may be engaged where...
Treasury creates RAO exemption for social landlords
A new exclusion from the regulated activity of credit broking will cover registered social landlords who introduce individuals to credit unions, community benefit societies, community interest companies limited by...
Treasury announces ‘Breathing Space’ for problem debts
HM Treasury has announced a new scheme to support those in problem debt, including those with mental health issues. The new scheme will introduce a new 60 day ‘Breathing Space period’ during which interest...
Alex LouchFCA announces BNPL rules
FCA has announced new rules for the Buy Now Pay Later market, taking effect later this year The rules will protect consumers by: banning firms from charging backdated interest on amounts of money that have been repaid...
Up next from FCA
FCA’s latest Policy Development Update heralds a few interesting papers on the near horizon, including: a consultation in June on alternatives to high cost credit; perhaps, a policy statement on general insurance...
FCA publishes overdraft cost reform rules
FCA has confirmed its final reforms to fix what it describes as a “dysfunctional” overdraft market. Andrew Bailey said he expects the reforms to mean the typical cost of borrowing £100 on an unarranged...
AG Opinion published on early settlement charges under CCD
The Opinion of the Attorney General has been published in a case referred by the Polish courts to the ECJ on the interpretation of article 16 of the CCD. The question regarded whether the calculation of the reduction...
Mastercard and Visa to lower interchange fees for payments in Europe
The European Commission has announced that Mastercard and Visa have made binding commitments to reduce interchange fees charged for payments in Europe to customers with consumer debit and credit cards issued outside the...
Memorandum of Understanding between the FCA and the ASA published
The FCA has published a Memorandum of Understanding between the FCA and the ASA. The MoU sets out the areas of responsibility for the FCA and ASA in relation to advertising in the financial services industry. It also...
FCA makes new rules
FCA’s latest handbook notice outlines all the rules adopted by FCA in its February and March Board meetings, including some not reported on in other FIN items. It includes a fill its of all the Brexit instruments...
FCA extends temporary permissions window
In light of the current short extension to Brexit, FCA has decided to extend the notification window for EEA firms to apply for temporary permissions. The window was due to close on 28 March, but will now close on 11...
FCA Publish Final Report on the Retained Provisions of the CCA
The FCA has published its final report on the retained provisions of the CCA on 25 March 2019. This final report sets out the FCA’s views on whether the repeal of certain CCA provisions would have an adverse...
What the Consumer Credit firms can expect from the FCA
The FCA has published a speech by Jonathan Davidson, Executive Director of Supervision – Retail and Authorisations, in which he sets out what the consumer credit sector can expect from the FCA in terms of regulation. Mr...
Angie BamboulisCMA’s Loyalty Penalty Working Group terms of reference published
Following work by both the FCA and the CMA, and the ‘loyalty penalty’ super-complaint, the CMA has published the terms of reference of its recently convened Loyalty Penalty Working Group (LPWG). The LPWG...
Debt management sector: second FCA thematic review published
The FCA has published TR19/01, the second set of findings of its review of the debt management sector. The focus of this review was firms that provide debt advice and administer debt management plans, on a for- or a not...
FCA Update on Digital Regulatory Reporting
The FCA has updated its webpage on digital regulatory reporting (DRR) by publishing – a video which explains the concept of DRR and outlines the work carried out by the DRR pilot group; a report which sets out an...
FCA finalises guidance on SoRs and responsibilities maps
FCA has published its finalised guidance to help firms prepare their statements of responsibility and responsibilities maps under the SMCR. The guidance addresses the rules as they apply to each category of SMCR firm...
FCA confirms FOS increase
FCA has issued a policy statement confirming the increase in the FOS award limit. From 1 April, the limit that FOS can award against firms will be £350,000. This amount will apply in relation to complaints about...
FCA makes Directory rules
FCA has made its final rules on its “Directory“. The new public register will enable searches on all directors and senior managers, certification staff and other individuals who require qualifications to...
FCA targets high-cost credit firms
FCA has written a “portfolio strategy letter” to firms that provide high-cost lending products such as guarantor loans, high cost short-term credit and unsecured loans for sub-prime customers, home-collected...
FCA reviews credit card fees and charges
The FCA has written to credit card firms to request they review their policies and procedures in relation to fees and charges, to ensure they result in fair consumer outcomes and comply with CONC. The letter follows the...
EU agrees draft directive to enhance consumer protection
The EU has agreed the terms of a draft directive that, if passed, will amend a number of consumer protection directives, including the consumer rights directive (2011/83/EU), to introduce measures such as: harmonised...
FCA introduces rent-to-own price cap
FCA confirmed today that it would be introducing a price cap in the rent-to-own (RTO) market. The regulator said that it wanted to “bring down prices on RTO agreements where the overall costs to consumers are...
FIN. TeamFCA unhappy with motor finance commission models
FCA is likely to propose changes to how commission works in the motor finance sector. It has carried out a review and has found that commonly used models allow brokers discretion to set the interest rate customers pay...
FCA updates rules
FCA has made a number of amendments to various parts of its rulebook, including: amendments to COBS on information relating to pensions savings, taking effect from November 2019 and April 2020; introducing a Devolved...
Up next from FCA
FCA is running behind schedule on some expected publications. Its latest Policy Development Update highlights the following: consultation and discussion on the Investment Platforms Market Study remedies due in March...
BoE and FCA update on Brexit approach
BoE and FCA have updated their respective websites with coordinated information on their approach to a hard Brexit. BoE has published a series of materials setting out its updated plans to its supervisory approach to a...
Court rules that Brexit is not frustrating event for a lease
The High Court has ruled that a European agency cannot terminate the lease of their premises at Canary Wharf on the basis of Brexit being a ‘frustrating event’. Our article provides more detail on this case...
Financial Stability Board 2019 work programme published
The Financial Stability Board has published its work programme for the forthcoming year. The areas upon which it intends to focus are: addressing emerging vulnerabilities in the financial system; working with standard...
FOS focuses on debt
The most recent edition of Ombudsman News focuses on enquiries FOS has received about debt collection – on credit cards, loans and mortgages. It took on over 1,000 complaints in the area during 2018. As a result...
FCA agrees Brexit MoUs with European securities regulators
As part of the preparation for a ‘no-deal’ Brexit, the FCA has agreed MoUs with ESMA and with EU and NCAs, covering supervision, enforcement and information exchange, including in relation to credit rating...
Regulators consult on FSCS MELL
FCA and PRA are consulting on the management expenses levy limit (MELL) for FSCS for the 2019/2020 year. They propose an increase of 2.4% over the current year with a levy for FSCS management expenses of £74.6m and an...
FCA feeds back on RND and Plevin issues
FCA has published a detailed policy statement to back up the new rules on regular premium PPI complaints and recurring non-disclosure of commission. FCA stresses that one of the main purposes of its consultation and now...
FCA makes new rules
FCA’s latest Handbook Update lists rules made in December and January. The key changes: amend the rules on PCAs and Overdrafts from 18 December 2019: these changes amend BCOBS and CONC to tackle low levels of...
Treasury writes to Treasury Committee on no-deal planning law
The Treasury has written to the Treasury Committee enclosing a draft of secondary legislation that would give temporary transitional powers to the UK financial regulators in the event of a no-deal Brexit that would...
FCA to look at product governance and research unbundling
A set of oral evidence given to the Treasury Committee includes statements from FCA that: it is now content on how to interpret the mortgage affordability test compliantly with the MCD and now plans to consult on...
New Financial Services head at Womble Bond Dickinson
We are delighted that Jonny Williams has joined the financial services regulatory team at Womble Bond Dickinson UK.
More information on Jonny and his appointment can be found here.
Evaluation of Consumer Credit Directive
The European Commission has opened a consultation to invite views from a range of stakeholders on the functioning of the Consumer Credit Directive (CCD). The purpose of the evaluation is to consider whether the CCD is...
FCA publishes sector views
FCA has published its “Sector Views” setting out its observations from monitoring its 7 selected sectors of: retail banking retail lending general insurance and protection pensions and retirement income...
FCA ‘Dear CEO’ letter on misleading financial promotions
The FCA has published a ‘Dear CEO’ letter in which it provides clarity about the communication and approval of financial promotions by regulated and unregulated businesses. The FCA has published the letter...
FCA consults on Brexit contractual continuity provision
At the end of last year, the the Treasury published draft regulations making provision for contractual certainty for firms currently passporting into the UK in the event of a ‘hard’ Brexit. Following this...
Up next from FCA
FCA’s latest Policy Development Update highlights a number of publications due before the end of Q1 2019: a policy statement on general standards and communication rules for payment services and emoney providers;...
FCA opens window for CMCs to register for temporary permission
In December 2018, the FCA confirmed that as part of its take over of the regulation of CMCs from April 2019, it would require CMCs to register for temporary permission in order to continue to operate from April, and...
PRA consults on Brexit measures
As part of its preparation for onshoring EU legislation, the PRA has published CP32/18. This consultation paper contains two consultations: the first sets out the PRA’s proposals regarding the PRA Rulebook and...
FCA publishes guidance for social landlords
The FCA has published final guidance for social landlords to help them understand when they may be acting as a credit broker in the course of assisting tenants find lower cost credit providers. FG18/6 will assist such...
FCA publishes feedback and further consultation regarding catalogue and store credit
Earlier this year, the FCA published CP18/12, which proposed measures to reduce consumer harm and strengthen protections for customers of home-collected credit, catalogue credit and store cards. Following this, the FCA...
FCA consults on tacking bank overdraft charges
As part of its ongoing work to tackle high cost credit, the FCA has announced proposals to restrict the charges banks are able to impose for overdrafts. The FCA is proposing a package of measures that include stopping...
FCA final rules and guidance for CMCs
Following a consultation earlier this year, the FCA has published a policy statement setting out the new rules and fees that will apply to claims management companies (CMCs) from April 2019. From 1 April 2019, the FCA...
FCA publishes final rules on expansion of FOS jurisdiction to SMEs
The FCA has now published final rules confirming the expansion of the jurisdiction of the FOS to include certain SME customers. The new rules will mean that from 1 April 2019, the FOS will be able to hear complaints...
FOS consults on plans for 2019/20
The FOS has published a consultation on its plans and budget for 2019/2020. It notes that from April 2019, its jurisdiction will be expanded by the addition of two significant areas of work: complaints made by SME...
New Corporate Governance Principles published
The Financial Reporting Council has published the final version of new Corporate Governance Principles for large private companies.
We have published an article that summarises and discusses these Principles.
Suzanne GadoFCA publishes quarterly consultation
FCA’s latest quarterly consultation proposes rules that: amend SUP 16 to address FCA’s concern that it does not always hold accurate “firm details” by requiring an annual accuracy check and...
CMA Consults on Annual Plan 2019/2020
The Competition and Markets Authority (CMA) is consulting on its proposed Annual Plan, which sets out its plans and priorities for 2019 to 2020. Subject to the outcome of the Brexit negotiations, the CMA plans to give...
FCA publishes approach to authorisation and feedback statement
Following a consultation last year, the FCA has published the ‘FCA Mission: Approach to Authorisation’ and feedback statement. This document includes reference to the introduction of a new range of tools to...
FCA delays Credit Information Market Study
FCA announced today that it will be delaying the launch of its Credit Information Market Study Terms of Reference until June 2019. The delay is a result of the FCA having to prioritise the market study on general...
FSB announces appointment of new FSB Chair and Vice Chair
The Plenary of the Financial Stability Board (FSB) has announced the appointment of Randal K. Quarles (Governor and Vice Chairman for Supervision at the US Federal Reserve) as its new Chair and Klaas Knot (President of...
FCA consults on proposed price cap on the rent-to-own market and confirms final rules on extended warranties
The FCA has published a consultation paper (CP18/35) setting out its proposals to introduce a price cap on rent-to-own (RTO) firms, summarising the feedback to the consultation carried out in May 2018 on high-cost...
CMA proposes changes to the Payment Protection Insurance Market Investigation Order 2011
In the light of the implementation of IDD, the CMA is proposing to amend the Payment Protection Insurance Market Investigation Order 2011 (Order). Currently, the Order requires PPI providers to send policyholders and...
Call for interest in new payment Standards Advisory Panel
The Bank of England and Pay.UK are inviting expressions of interest from senior stakeholders who could represent the payments industry on a newly created Standards Advisory Panel. The new Panel will focus on the...
FCA publishes final guidance on PPI complaints and proposes re-opening closed complaints
Following its consultation in July 2018 on handling complaints about regular premium PPI, the FCA has published finalised guidance that confirms that firms should assess PPI commission disclosures not only at point of...
FCA updates on complaints data
FCA has published its H1 2018 complaints data, which show that firms received more than 4 million complaints in the period. This was a 10% increase from the previous period. Nearly all the complaints were made to 235...
FCA evaluates bringing additional benchmarks into the regulatory and supervisory regime
FCA has today published Evaluation Paper 18/2 on the impact of bringing additional benchmarks into the regulatory and supervisory regime. The paper is the second of a new series of FCA evaluations on its past...
UK retail payments authority re-named and re-branded
The New Payment System Operator (NPSO) has today announced its new name and brand: Pay.UK The new name and identity is aimed at helping the payments authority to better promote its core purpose, which is to transform...
FCA Feedback Statement on Digital Regulatory Reporting
The FCA has published a feedback statement on digital regulatory reporting. This follows the FCA’s call for input on smarter regulatory reporting in February 2018. The FCA found that most respondents agreed that...
FCA WRITES TO FIRMS ON AFFORDABILITY OF HCSTC LOANS
The FCA has published a ‘Dear CEO’ letter setting out the issues surrounding the increase in complaints about unaffordable lending (including complaints about a ‘chain’ of loans over an extended...
Treasury updates Brexit SIs
Treasury has published some new draft statutory instruments to be made under the EU (Withdrawal) Act, or announced plans to make them, and also updated existing drafts. New or updated documents include Regulations on :...
FCA publishes Brexit consultations following HMT Guidance
As heralded at the end of last year, the FCA has now published two consultation papers that make provision for operations in the event of a ‘hard’ Brexit next March. The first consultation sets out changes...
FCA sets out its expectations on debt packager firms providing debt advice and counselling services
The FCA has published a ‘Dear CEO’ letter to debt packager firms, setting out its expectations on the provision of debt advice and counselling services. The FCA is concerned about the poor standards it has...
Up next from FCA
FCA’s latest policy development update promises various publications before the end of this year, including: policy statement on the approach to the final RTS and EBA guidelines under PSD 2, in December; policy...
FCA makes new rules
FCA has made three new rules instruments at its September board meetings: the Individual Accountability (Dual-Regulated Firms) Instrument 2018: this instrument makes significant changes to SYSC as well as to COCON...
FCA thematic review on credit broking remuneration models
The FCA has published its thematic review on the impact of credit broking remuneration models at the point of sale. The thematic review covered a wide variety of credit brokers offering loans or finance provided by a...
FCA consults on applying SM&CR to CMCs
The FCA has opened a consultation that sets out how it will apply the Senior Managers and Certification Regime (SM&CR) to Claims Management Companies (CMCs), following taking over regulation of them from 1 April...
ASA rules on RAPR prominence in TV ad
The ASA has published a ruling which upheld a complaint that the representative APR (RAPR) in an advertisement for Sunny Loans was insufficiently prominent. The advert’s ‘incentives’ that triggered...
Firms’ permissions cancelled for failure to be open and co-operative with the FCA
The FCA has cancelled the Part 4A permissions of two firms, Causeway Group Limited and Prime Render Solutions Limited . The cancellation of the permissions is due to both firms failing to satisfy the suitability...
Law Commission confirms status of electronic signatures
In December 2017 the Law Commission confirmed that one of the projects it would be working on was addressing the absence of explicit case law and legislation that has given rise to uncertainty as to the validity of...
FSB launches peer review of LEIs
The Financial Stability Board has published the Summary Terms of Reference of a thematic peer review of the implementation of the Legal Entity Identifier. The thematic review seeks feedback from a range of stakeholders...
FCA publishes interim report on CCA review
The FCA is progressing with its statutory obligation to review the CCA, by publishing an interim report on its review. The interim report sets out the FCA’s initial views on whether the repeal of CCA provisions...
Tribunal rules on Validation Order on credit agreements brokered by unauthorised firm
The Tribunal has handed down its decision in the case of Plexedes Chickombe and 44 others v the FCA and Clydesdale Financial Services Limited trading as Barclays Partner Finance (Clydesdale) as interested party. The...
FCA’S FINAL RULES ON ASSESSING CREDITWORTHINESS IN CONSUMER CREDIT
The FCA has published a policy statement setting out its final rules and guidance on assessing creditworthiness in consumer credit. The policy statement summarises and responds to the feedback the FCA received to the...
FCA updated guidance for firms outsourcing IT
The FCA has updated FG 16/5, ‘Guidance for firms outsourcing to the ‘cloud’ and other third party IT services’. This update takes account of the publication of the European Banking...
FCA publishes research note on credit card users’ debt
The FCA has published a note that summarises research conducted as part of the FCA Credit Card Market Study into helping credit card users who are only making the minimum payments increase the rate at which they repay...
Corporate governance reporting and the impact on large private companies
We have written an article on the new corporate governance reporting requirements for certain large private companies. The requirements will come into force on 1 January 2019 applying to financial years beginning on or...
FCA bans individuals for misleading consumers
FCA has banned the 4 former directors of a now-dissolved credit broker, Secure My Money Limited. It found the firm misled customers into thinking they had been approved for short term loans and as a result took fees of...
FCA publishes intervention approach documents
On a new page on its website, ‘Measuring our impact before we intervene‘, the FCA has published a group of documents that aim to provide an indication of how the FCA assesses the likely impact of its...
FCA publishes Annual Report
FCA has published its Annual Report and Accounts for 2017/18. The report includes details of: FCA’s work preparing for Brexit; key regulatory changes such as MiFID 2 and PSD 2; work on SMCR extension; thematic...
The FCA’s discussion paper on the introduction of a duty of care
Alongside the Approach to Consumers document, which was published on 17 July 2018, the FCA has published a discussion paper (DP18/5) on the introduction of a duty of care for financial services firms. In response to the...
The FCA’s Approach to Consumers
Following its consultation in November 2017, the FCA has today published its Approach to Consumers document which aims to address the concerns raised in the feedback to the consultation. The consultation took place...
Treasury publishes Brexit consumer credit changes
Treasury has published a draft statutory instrument setting out changes to consumer credit legislation consequent on Brexit. The draft has not yet been laid before the relevant parliamentary committees for...
FCA and PSR Chair discusses potential future algocracy
Charles Randell, the recently appointed Chair of the FCA and the PSR, has delivered a speech, in which he discussed the increasing dominance of algorithms in our day to day lives, and noted some of the consequent issues...
Banking (Cash Machine Charges and Financial Inclusion) Bill 2017-19
Parliament has announced that the second reading of the Banking (Cash Machine Charges and Financial Inclusion) Bill 2017-19 is scheduled to take place on Friday 23 November 2018. The Bill contains provisions which...
FCA thinks about price discrimination
FCA has published a paper looking at how it should approach fairness in price discrimination in financial services. It notes that price discrimination is not in itself unfair as practices such as student discounts are...
Discussion Paper on building the financial sector’s operational resilience
The Bank of England, the PRA and FCA have published a joint discussion paper on its approach to improve operational resilience in the financial sector. The regulators envisage that boards and senior managers can achieve...
FCA consults on regular premium PPI complaints handling
FCA is consulting on new guidance on handling complaints about regular premium PPI, to deal with an uncertainty which has arisen since the post-Plevin rules. The Plevin judgment and the rules that followed it say that...
Themes from thematic reviews
We recently wrote an article for Compliance Monitor setting out themes from recent FCA thematic reviews.
FCA publishes update on Strategic Review of Retail Banking Business Models
The FCA has published a progress report on its ongoing Strategic Review of Retail Banking Business Models. The purpose of the Review is to consider the sources of competitive advantage that may have helped the major...
HMT, Bank of England and FCA set out approach to onshoring financial services legislation
The Treasury, the Bank of England and the FCA have published information about how financial services legislation will be on-shored under the EU (Withdrawal) Act, in particular to ensure the (hopefully unlikely)...
Mansion House 2018: Speech by the Chancellor of the Exchequer
HM Treasury has published a speech by Philip Hammond, Chancellor of the Exchequer, which was delivered at the annual Mansion House dinner. In his speech, Mr Hammond focused on Brexit and financial services. He said that...