On 21 October 2021, HM Treasury issued its long anticipated consultation on the regulation of Buy-Now Pay-Later (BNPL) products. Background In February the government announced its intention to bring unregulated interest-free BNPL products within the scope of regulation given the potential risk of consumer detriment highlighted in the Woolard Review. Following the announcement the government … Continue Reading
On 8 October 2021, the FCA published a speech by Nisha Arora (Director of Consumer and Retail Policy, FCA) entitled Regulating for better outcomes – next steps in consumer credit. Key points in the speech include: It’s never been more important that the consumer credit market works well for consumers, firms and the economy. The … Continue Reading
On 24 May 2021, the FCA updated its consumer credit information sheets in accordance with the Consumer Credit Act 1974 (section 86A). The FCA has specified that these will come into force on 25 October 2021 in accordance with section 86A(7) of the Act. The FCA has changed the information sheets to provide more targeted … Continue Reading
On 12 May 2021, the FCA announced that it was asking regulated firms that hold the credit broking permission to complete a short survey to update the information the regulator holds on how they are using this permission. The FCA believes that it should be possible for firms to complete the survey within 30 minutes. … Continue Reading
On 13 April 2021, the FCA issued a short statement on its website reminding firms about changes certain consumer credit firms will have to make to pre-contract consumer credit information forms. These changes will need to be made from 1 June 2021. If they are not made, the credit agreement may only be enforceable against … Continue Reading
On 2 December 2020, the FCA published an evaluation of its price cap on rent-to-own (RTO) products, which came into force in April 2020. The evaluation shows that the price cap has been effective in reducing the prices charged by RTO firms. The FCA estimates that the cap led to an average fall in prices … Continue Reading
On 2 December 2020, the FCA published a letter it had sent to the board of directors of firms assigned to the mainstream consumer credit lenders portfolio. In the letter the FCA: Sets out its view of the risks mainstream consumer credit lenders may pose to their consumers or the markets in which they operate. … Continue Reading
On 19 November 2020, the FCA confirmed updated guidance to firms setting out enhanced support that should be available to consumer credit customers experiencing payment difficulties as a result of the COVID-19 pandemic. The guidance covers users of personal loans, credit cards, store cards, catalogue credit, rent to own, buy now pay later, pawn broking, … Continue Reading
On 11 November 2020, there was published on legislation.gov.uk The Consumer Credit (Enforcement, Default and Termination Notices) (Coronavirus) (Amendment) Regulations 2020 together with an explanatory memorandum. The Consumer Credit Act 1974 (the Act) created a consumer protection regime, which required creditors or owners to send notices to borrowers or hirers under regulated agreements before taking … Continue Reading
On 2 November 2020, the FCA issued a call for input seeking views into how the unsecured credit market is changing, particularly in light of the COVID-19 pandemic, and how regulation can support this market. The call for input is focussed on the following four key themes: Drivers and use of credit. The FCA has … Continue Reading
On 13 October 2020, the FCA published a speech by Nisha Arora (Director of Consumer and Retail Policy) entitled FCA regulation of consumer credit – during the pandemic and beyond. Key points in the speech include: In all the FCA’s work to protect consumers in credit and other markets, it is guided by the Principles … Continue Reading
In April 2020 the FCA published temporary guidance setting out how it expects firms to support consumer credit and overdraft customers who were facing temporary payment difficulties because of the exceptional circumstances arising out of coronavirus. This guidance was updated in July (the July Guidance). On 31 July 2020, the FCA published a Call for … Continue Reading
On 16 September 2020, the FCA announced that Chris Woolard will chair a review of the future regulation of the unsecured credit market. The review will concentrate on how regulation can better support a healthy unsecured lending market. It will take into account the impact of the coronavirus pandemic on employment security and credit scores, … Continue Reading
On 6 August 2020, the FCA published the findings of its review into relending by firms that offer high-cost credit. The review, which was completed prior to the coronavirus pandemic, highlights concerns about poor practices by some firms and notes that nearly half of consumers regretted borrowing more money. As firms in this sector begin … Continue Reading
The COVID-19 pandemic is continuing to present challenges across the board with regional lockdowns, closures of “air-bridges” and talks of a second wave dominating media outlets at the present time. If the pandemic has brought certainty in one regard, it is that the future is more uncertain than ever. In order to help provide further … Continue Reading
On 28 July 2020, the FCA announced that following its earlier consultation in October 2019 it will introduce a ban on motor finance discretionary commission models. In the light of consultation feedback and the additional operational pressures which the motor finance sector is facing at present the FCA has agreed to give firms limited additional … Continue Reading
On 24 April 2020, the FCA published temporary guidance concerning: Motor finance agreements and coronavirus. High-cost short-term credit (HCSTC) and coronavirus: temporary guidance for firms. Rent-to-own, buy-now pay-later and pawnbroking agreements and coronavirus. On 3 July 2020, the FCA announced proposals to amend the above temporary guidance so to provide continued support for users of … Continue Reading
On 23 June 2020, the European Commission published a roadmap concerning a review of the Consumer Credit Directive (CCD). Following a REFIT Platform opinion recommending an assessment of the relevance, effectiveness and efficiency of the standard information to be included in advertising concerning credit agreements, the Commission evaluated the CCD in 2018-2019. The full results … Continue Reading
On 4 May 2020, the European Supervisory Authorities (ESAs) published joint draft Regulatory Technical Standards (RTS) to amend the Delegated Regulation on the risk mitigation techniques for non-centrally cleared over-the-counter derivatives (bilateral margining), under the European Markets Infrastructure Regulation, to incorporate a one-year deferral of the two implementation phases of the bilateral margining requirements. On … Continue Reading
Over the coming weeks, partners from our financial services team will be sharing with clients and contacts a series of video diaries setting out their views on the latest developments in respect of COVID 19 impacts in the various areas of financial services. In our fourth video diary, Matthew Gregory discusses today’s FCA proposals (made … Continue Reading
Over the coming weeks, partners from our financial services team will be sharing with clients and contacts a series of video diaries setting out their views on the latest developments in respect of COVID 19 impacts in the various areas of financial services. In our third video diary, Iain Hawthorn discusses the recent government announcements … Continue Reading
On 13 February 2020, the FCA published a letter setting out its views on the key risks credit brokers could pose to their consumers or markets. Credit brokers are asked to consider the extent of these risks in their business and assess if their strategies reduce the risks. The FCA explains that it has examined … Continue Reading
On 5 February 2020, the Goods Mortgages Bill (the Bill) had its first reading in the House of Lords. If the Bill becomes law it will repeal the Bills of Sale Acts 1878 and 1882 and create a new form of non-possessory security that may be created over goods owned by individuals. The Bill allows … Continue Reading
On 15 October 2019, the FCA published Consultation Paper 19/28: Motor finance discretionary commission models and consumer credit commission disclosure (CP19/28). In CP19/28 the FCA is proposing a ban on commission models where the amount received by the broker (including motor dealers) is linked to the interest rate that the customer pays and which the … Continue Reading
