Regulation  

FCA gets tough with credit companies without interim permission

According to a notice from the City watchdog, businesses continuing to offer credit to customers without interim permission could be acting illegally and that their agreements with consumers could be unenforceable.

The notice from the regulator said that 85 per cent of consumer credit firms have registered for interim permission with the FCA. The number of those who have registered totals 43,751.

Interim permission enables consumer credit companies to continue to offer consumer credit services, such as personal loans, until invited by the FCA to apply for full authorisation.

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Applications for full authorisation will be invited from October this year. Companies can continue to operate on the basis of interim permission in the meantime.

The cost of interim permission is £350 for most businesses. Sole traders are charged £150.

Businesses affected include payday lenders, insolvency practitioners and other professional firms. The full list can be viewed at www.fca.org.uk/firms/firm-types/consumer-credit/scope.

IFA Quote

Keith Churchouse, principal of Guildford-based Chapters Financial, said: “The sooner that these businesses can be authorised, the better and any businesses affected should act quickly to ensure they are registered correctly, in time.

“I welcome the move towards full authorisation by October. This is a sector that needs to be cleaned up as soon as possible.”