Consumer credit

Consumer Credit businesses are wide ranging and include banks, hire purchase companies and payday loan companies. Our team works with organisations across the consumer credit sector, from small banks to investors and lenders to ensure the consumer credit agreements they offer are properly structured and compliant with the regulations set out in the Consumer Credit Act (and FSMA). Our team has also advised organisations such as private schools offering deferred payment schemes to parents.

Consumer Credit

Consumer credit is a personal debt that is taken out by a consumer on the purchase of a product or service in exchange for a repayment schedule. The Financial Conduct Authority, the regulatory body of consumer credit businesses, grants authorisation to businesses to offer credit to customers. The legislation sets out how the authorised businesses can lend money and collect it, including the information that needs to be provided to consumers and how it should be presented. It also sets out when an agreement may be exempt from complying with the consumer credit rules.

As a business, you will need to assess whether your credit agreement could be caught by the regulations. If you are concerned about this, our team would be happy to discuss your proposed arrangement with you and advise whether you will need to comply with the legislation or whether there is an exemption that your agreement falls under.

If your agreement must comply with the regulations you may need to seek authorisation from the FCA. While this process can be onerous, our team can guide you through the process of applying for authorisation, preparing the necessary documentation and compiling evidence that treating customers fairly is as the heart of what you do.

When you receive permission to offer consumer credit, we can work with you to implement an easily managed credit scheme that will ensure ongoing compliance with the FCA’s standards and help you to prepare compliant credit documentation for use with customers.

If you would like to discuss the possibility of creating a consumer credit program for your customers or would like assistance with the application process, our team can advise you in a jargon-free, practical way so you’re confident in every step you take.