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...
Category - Consumer Credit
Angie BamboulisFCA 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...
FIN. TeamASA 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...
Roseyna JahangirFirms’ 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...
Suzanne GadoFCA 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...
Emma RadmoreFCA 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...
FCA writes to CEOs on second charges and responsible lending
FCA has written a Dear CEO letter to firms that enter into regulated second charge mortgage contracts, asking them to review their lending processes and confirm to FCA that the firm is acting responsibly when lending...
FCA updates on consumer credit landscape
Andrew Bailey has spoken to the FLA on the current consumer credit landscape. He noted the constant fall in the real cost of debt which has supported the rise in household borrowing, and the growth in consumer credit...
The FCA fines Vanquis £1,976,000 for failure to disclose full price of an add-on product
The FCA has fined credit card lender, Vanquis, £1,976,000 and ordered it to pay compensation to customers for failing to disclose the full price of an add-on product called Repayment Option Plan. In particular, the FCA...
FCA publishes its final policy statement on new rules for the credit card market
Following a comprehensive study of the credit card market, the FCA has published its final policy statement on new rules for the credit card market. The new rules aim to provide more protection for credit card customers...
FCA updates on service standards
FCA’s new-look update on its service standards shows that it met most of its targets for various regulatory tasks, including authorisations, passport notifications, dealing with queries and customer satisfaction...
FCA explains perimeter to Treasury Committee
Andrew Bailey has written to the Treasury Select Committee setting out a summary of the powers “FCA does not have”. It has been asked many questions in the context of the RBS GRG investigation. The letter...
FCA review of Board Effectiveness
The FCA has published a report of the independent review into the effectiveness of its Board. The review was undertaken by Independent Audit Limited. The review involved interviews with Board members, a review of...
FCA updates on high-cost credit sector
Following a Feedback Statement in which FCA identified key areas of concern in the high-cost credit sector, it has published an update on the work undertaken since the July 2017 publication. This presents an emerging...
FCA consults on widening FOS access for small businesses
FCA has opened a consultation on plans to provide more small businesses with access to FOS. The changes proposed would allow FOS complaints redress to approximately 16,000 SMEs, charities and trusts, by changing the...
FSCS PUBLISHES PLAN AND BUDGET FOR 2018/2019
The Financial Services Compensation Scheme (FSCS) has published its Plan and Budget for 2018/2019. The Plan and Budget outlines the FSCS’s expected management costs and initial levy forecasts financial services...
The PRA’s “Dear Chair” letter on consumer credit
On 17 January 2018, the PRA published a “Dear Chair letter” following a review on consumer credit lending (covering credit cards, personal loans and motor finance) and the publication of its statement on...
FCA INSIGHT ARTICLE: Who is driving consumer credit growth?
The FCA has published an Insight article that considers who is driving consumer credit growth. Although regulators have relied upon aggregate data from larger lenders to monitor which lenders are driving credit growth...
Charles Randell becomes new FCA and PSR chair
Charles Randell CBE has been appointed the new chair of FCA and the PSR with effect from 1 April.
ESMA consults on draft Securitisation Regulation technical standards
The European Securities and Markets Authority has published three consultation papers on draft technical standards implementing the Securitisation Regulation that is expected to be published by the end of this year. The...
Treasury, FCA and EIOPA issue statements regarding continuity of activities and services after Brexit
Along with the PRA’s publication of consultation papers on its intended approach to supervision of third country firms, the Treasury, FCA and ESMA have recently issued statements providing an update on provision...
Digital comparison tools: government responds to CMA market study
Earlier this year, the Competition and Markets Authority (CMA) published the results of a market study into the use of digital comparison tools in a number of sectors, including car insurance, home insurance and credit...
Payment Services Regulator requires change to Direct Debit rules regarding switching Facilities Management providers
The Payment Services Regulator (PSR) has published its decision to require the operator of the Bacs payment system, of which the Direct Debit scheme is a part, to change its rules to help clients switch Facilities...
Law Commission to address electronic signatures and smart contracts in 13th Programme of Law Reform
The Law Commission has announced the programme of reforms it will be working on over the next 3 years. The projects include: Electronic signatures: there is an absence of explicit case law or legislation confirming...
FCA updates on persistent debt
FCA has updated its consultation paper on its proposals for rules to help customers in persistent credit card debt. The revised proposals follow feedback on its April consultation. Respondents were in favour of...
FCA sets out future approach to authorisation and competition
FCA has outlined its approach to authorisation and to competition. It notes it is one of the few financial regulators in the world with an objective that includes promoting competition. It wants to understand, in...
FCA CLOSES CONSULTATION ON persistent debt and earlier intervention remedies
The FCA has updated its webpage on its consultation on persistent debt and earlier intervention remedies (CP17/10). Now that the consultation has closed, the FCA stated on its website that they are consulting on...
FCA roundtables on high-cost credit
The FCA has issued a paper summarising the issues and ideas raised by participants in the FCA roundtables, held in September and October. The roundtables covered discussions on (i) alternatives to high-cost credit and...
Up next from FCA
FCA’s latest Policy Development Update promises the following publications before the end of 2017: Policy Statement on formalisation of the debt concession for smaller credit unions Policy Statement on market...
Financial Stability Report, November 2017
The Bank of England (BoE) has published its financial stability report, issue number 42. The report sets out the Financial Policy Committee’s (FPC), a sub-committee of the BoE’s Court of Directors, views of...
Law Commission finalises Goods Mortgages Bill
The Law Commission has published its final report on the Goods Mortgages Bill. This marks the end of a project that started in 2014, aimed at addressing the problems the outdated Bills of Sale Acts cause for borrowers...
Autumn Budget 2017: Key points for the financial services sector
Philip Hammond, Chancellor of the Exchequer, has delivered the Autumn Budget 2017. Key points for the financial services sector include: Asset management – the Government will publish a new long-term strategy to...
FCA consults on fees
FCA has published its annual consultation paper on regulatory fees and levies. Key proposals include: the proposed tariff data FCA will use to calculate insurers’ FCA periodic fees and the FOS levies, building on...
Financial Exclusion: UK government publishes response to Lords Select Committee final report
Following the appointment in 2016 by the House of Lords of a Select Committee to investigate financial exclusion and access to mainstream financial services, the Committee published its final report, ‘Tackling...
Treasury Committee inquiry into household finances
On 8 November, the Treasury Committee announced the launch of a new inquiry that will examine problematic indebtedness, inter-generational issues, lifetime financial planning and the effectiveness of the market in...
The Supreme Court grants Deutsche Bahn AG permission to appeal against a Court of Appeal judgment concerning interchange fees
The Supreme Court (SC) today announced that permission to appeal has been granted to Deutsche Bahn AG (and other retailers) against the Court of Appeal’s judgment upholding an appeal by MasterCard against a judgment of...
FCA’s future approach to consumers
The FCA has today published its Approach to Consumers paper, which is intended to explore the FCA’s approach to regulating retail consumers. The paper follows the publication of the FCA’s Mission Statement...
Interest Rate rises for the first time in 10 years
For the first time in more than 10 years the Bank of England (BoE) has raised interest rates. At its meeting on 1 November, the BoE’s Monetary Policy Committee (MPC) voted by a majority of 7-2 to increase the...
FCA bans firm for failure to comply with FOS award
FCA has cancelled the permission of Foreman Financial Services Limited for failure to remain fit and proper and specifically for breach of DISP rules and Principles 6 and 11. The firm had advised a customer to transfer...
FCA consults on FSCS funding
Following its December 2016 consultation for views on how FSCS funding could be reformed, FCA has published a further consultation paper seeking to ensure FSCS continues to provide the right protections, works...
New FCA webpage on reporting consumer credit income
The FCA has published a new webpage setting out what consumer credit firms need to report in relation to their consumer credit income. The FCA charges consumer credit firms annual fees based on the data in forms CCR002...
FCA updates on retail banking model review
FCA has published a paper on the purpose and scope of its review of the business models used in the retail banking sector. It is now considering what evidence it can best gather to understand: the state of competition...
HM Treasury’s Call for Evidence to tackle problem debt
On 24 October 2017, HM Treasury published a Call for Evidence to implement a breathing space scheme so that someone in serious problem debt may apply for legal protection from further interest, charges and enforcement...
FCA begins debt management sector review
In line with its 2017/18 Business Plan, FCA has begun its thematic review of the debt management sector. FCA has taken a particular interest in this sector, owing to the increased risks faced by (particularly...
FCA’s first Financial Lives Survey: 50% of UK adults potentially vulnerable
After collecting responses from over 13,000 UK consumers, FCA has revealed the results of its largest tracking survey of consumer behaviour and use of retail financial products and services. Aiming to tell the financial...
The Consumer Protection Partnership Update Report for 2017
The Department for Business, Energy & Industrial Strategy has published a report by the Consumer Protection Partnership (CPP), identifying and prioritising areas where there is greatest harm caused to consumers and...
Up next from FCA
FCA’s latest Policy Developments Update lists several key publications due before the end of the year: policy proposals for next year’s fees and levies policy statement on FSCS funding policy statement on...
FCA speaks on challenges of ageing population
Andrew Bailey, speaking at Mansion house, looked at some of the challenges FCA faces as financial conduct regulator. He focussed particularly on: consumer credit – particularly on its rapid growth and the role of...
FPC updates on stability
FPC has reviewed developments since its last meeting on 21 June and assess the outlook for UK financial stability. Its conclusion was that ‘overall risks to UK financial stability from the domestic environment are...
Law Commission publishes draft Goods Mortgages Bill
Following a 2016 report in which the Law Commission concluded that the Bills of Sale Acts should be repealed and replaced with legislation less burdensome to lenders and more protective of borrowers, and its...
Update from the Bank of England and The Payment Systems Regulator on new payment systems operator
In a joint press release issued today, the Bank of England (BoE) and The Payment Systems Regulator (PSR) announced that a New Payment Systems Operator (NPSO) had been created by the Payment System Operator Delivery...
FCA unhappy with consumer credit complaints handling – asks firms to take action
In a Dear CEO Letter, the FCA explains that it recently undertook a review of how consumer credit firms approach and deal with customer complaints. FCA reviewed data, final response letters and website information on...
FOS updates complaints data
FOS has published individual complaints data for H1 2017, relating to businesses in relation to which FOS both received and settled at least 30 cases during the period. FOS says these firms comprise around 95% of the...
FCA launches PPI campaign with help from ‘Arnold Schwarzenegger’
The FCA has today launched its PPI campaign with a television advert in order to raise awareness of the two year deadline to make a complaint about payment protection insurance. The deadline, which has been introduced...