The Lending Standards Board (LSB) has published a report on its findings from its third party outsourcing themed review. The objectives of the review were to assess the adequacy of subscribers’ systems, processes and controls to ensure that where processes are outsourced, the Lending Code (the Code) is complied with and that any breaches are identified, reported and remedied.
Overall, the LSB found that all the firms included in the review have in place well-structured and robust management frameworks for third party suppliers. A key element of the framework is a detailed due diligence process which covers all necessary steps from the point the business need is first identified through to contractual requirements, financial and non-financial checks, on-boarding, service level agreements, business continuity and on-going performance management requirements.
The review only focused on UK outsourced arrangements as agreed with the LSB board at the outset. As overseas risk is felt to be much greater than domestic outsourcing and the use of third party suppliers the LSB will include this area in its new oversight strategy.
View LSB reports on third party outsourcing themed review, 17 August 2016