Consumer Credit Changes in 2014
As we know, the Financial Services Authority (FSA)
issued a consultation paper in March 2013 setting out
the proposed changes to the consumer credit market
when the Financial Conduct Authority (FCA) takes over
responsibility for consumer credit on 1 April 2014.
Post the consultation, the FCA have now put up a number
of dedicated web pages about this topic and these can be
found at –
http://bit.ly/19i4tzy
and
http://bit.ly/17GnM6y
In brief, the main points are –
• The FCA will take over all responsibility from the Office
of Fair Trading on 1 April 2014.
• There will be new rules similar to the current FCA style
and will include Threshold conditions, fit & proper
tests and changes to approved person responsibilities.
• At that date, all firms with existing Consumer Credit
Licences (CCL) must have applied for and received
interim permission from the FCA to continue
undertaking consumer credit activities.
• All Appointed Representatives must have also done
the same.
• The application process for interim authorisation will
begin in Q3 2013.
• All applications must be made electronically and will
include firm contact details, controller details and
current CCL activities.
• There will be an application fee, with a discount for
applications made by 30 November 2013.
• Firms will then have to apply for and receive full
authorisation by 31 March 2016.
• It is anticipated that the application process for full
authorisation will begin in Q4 2014 and the FCA is
planning to invite firms to apply.
• This area will be covered by FOS in the event of a
complaint, but access to FSCS is not available.
So, given the large number of firms in all areas (not
just financial services) that hold a CCL, this is a huge
undertaking for the FCA, so it is important that you watch
out for any communication from the regulator about this,
and if you do not hear anything, you must go to the FCA
and query this.
The first stage in this process is that the FCA and the
Office of Fair Trading (OFT) have issued a joint letter to
the Consumer Credit licence holders telling them that
they should check whether their licence details are
correct and cover all their activities. If this is relevant to
you, you will need to apply online to the FCA for interim
permissions. There is a fee of £150 for sole traders and
£350 for everyone else. There will be a discount for early
applicants (up to 30 November 2013).
The application process is now open and firms need to do
this via the FCA website.
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