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...
Category - Consumer Credit
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...
Emma RadmoreFCA 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...
Roseyna JahangirCourt 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...
Angie BamboulisFCA 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...
FCA Financial Lives Survey
The FCA have published a report on its Financial Lives Survey 2018. The survey is the FCA’s largest tracking survey of adults and their finances, covering 13,000 face-to-face and online interviews. Key findings...
Treasury’s response to call for evidence on breathing space scheme
HM Treasury has published a summary of the submissions received to the call for evidence on problem debt. The call for evidence was issued in October 2017 to gain further insight from the debt advice sector and...
Up next from FCA
FCA’s latest Policy Development Update heralds a policy statement on fees and levies rates in July. Otherwise its timetable is quiet, with a policy statement on the MMF Regulation due at some point together with...
FCA’s high-cost credit review published
The FCA has concluded its review into high-cost credit, and based on issues it found has published two consultations: CP18/12 on rent-to-own, home-collected credit, catalogue credit and store cards, and alternatives to...
FOS Annual Review published
The FOS has published its Annual Review for 2017/2018. Many of the complaints statistics highlight products that are the subject of ongoing regulatory scrutiny and activity: the FOS notes significant increases in...
ASA Ruling on Intelligent Lending Ltd t/a Ocean Finance
The Advertising Standards Authority (ASA) upheld a complaint about a credit card advertisement broadcast by Intelligent Lending Limited t/a Ocean Finance. The complainant challenged whether the advertisement should have...
GOVERNMENT SCRAPS NEW GOODS MORTGAGES BILL
HM Treasury has published the response to its September 2017 consultation on the proposed Goods Mortgages Bill and has announced that it is no longer planning to introduce new legislation on this subject at this time...
Rebecca JonesFCA makes new rules
FCA (in one case together with FOS) has made several instruments amending the Handbook. Changes include: changes to FEES (from 1 April) to ensure better mapping of tariff data and that Directive and non-Directive...
Wyman report on debt advice funding published
Peter Wyman’s report on a review of debt advice funding has been published. The report makes several recommendations, including: face-to-face advice should still be widely available but there should be general and...
Claims Management regulations published for consultation
As part of the proposed process of transferring the regulation of Claims Management Companies to the FCA, HM Treasury is consulting on draft regulations that will form part of a final statutory instrument creating a...
BEIS publishes Green Paper on modernising consumer markets
The Department for Business, Energy and Industrial Strategy is consulting on proposals which, among other issues, seek to to improve the consumer experience in regulated markets for utilities, telecommunications and...
ESAs report on key risks for H2 2017
The Joint Committee of the European Supervisory Authorities has published its report for the second half of 2017. This report highlights the following potential sources of instability: repricing of risk premia...
FCA and PRA publish business plans
The FCA and the PRA have both published their business plans for 2018/2019. The FCA’s business plan shines a spotlight on consumer protection, including in relation to pension products and high-cost credit, as an...
FCA and PRA consult on 2018/2019 regulated fee and levy rate proposals
The FCA and PRA have, separately, published consultation papers on regulated fees and levies for 2018/19. In its consultation paper, the FCA sets out the proposed 2018/19 regulatory fees and levies for itself, the...
FCA PUBLISHES POLICY STATEMENT AND FINALISED GUIDANCE ON STAFF INCENTIVES, REMUNERATION AND PERFORMANCE MANAGEMENT IN CONSUMER CREDIT
The FCA has published a Policy Statement (PS18/7) and Finalised Guidance (FG18/2) on staff incentives, remuneration and performance management in consumer credit. The Policy Statement sets out final rules for staff...
Complaints Commissioner concerned about information sharing between FOS and FCA
In a recent report the Complaints Commissioner expressed concern about the absence of published information about how and in what circumstances information about live ombudsman cases may be shared between the FOS and...
FCA sets out supervision and enforcement approach
FCA has published a draft of its approach to enforcement and supervision. The documents follow its publication of its Mission, in which it committed to publishing a series of documents setting out how it carries out its...
Andrew Bailey speaks on transforming culture in financial services
The FCA has published a speech by Andrew Bailey, FCA Chief Executive, on transforming culture in financial services. Mr Bailey highlights the following issues: work on firm culture is an important priority for the FCA;...
FCA speaks on affordability
Jonathan Davidson has spoken on getting affordability right in consumer credit. He said that as the UK consumer credit sector is growing, so are concerns about excessive debt. FCA does not consider the sector has yet...
BSB publishes annual review
The Banking Standards Board has published its annual review. Its key point is that, last year, it carried out the largest ever survey of behaviours, competence and culture in UK banking. It noted that the scores to its...
FCA updates on motor finance
FCA has updated on its work reviewing the motor finance sector. So far, it has drawn several comforting conclusions, including around general default rates. But the 3% of customers who have the lowest credit ratings...
FCA outlines approach to authorisation
Sarah Rapson has spoken of FCA’s approach to authorising firms. She focused on FCA’s use of authorisation as a way to prevent harm, and its focus on using it proportionately. As a result, the information it...
FCA looks back on past 5 years
John Griffith-Jones has reflected on FCA’s first 5 years of operation, since it took over from the FSA. He outlined: highlights – specifying FCA’s engagement with pension exit charges, general...
FCA Discussion Paper on transforming culture in financial services
As part of its ongoing work on culture and governance, the FCA has published a discussion paper, comprising a series of essays from academics and industry thought leaders covering: what a ‘good’ culture...
FCA surveys firms passporting into UK
As part of its preparation for Brexit, the Government announced in December 2017 that it would, if necessary, introduce legislation to enable a ‘temporary permission’ scheme for EEA firms and funds which...
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