What does FCA authorisation involve for consumer credit firms?

It involves meeting regulatory requirements set by the FCA for consumer credit activities such as licensing, risk controls, governance, customer protection, financial stability, and ongoing compliance.

What documents are needed for FCA authorisation of consumer credit firms?

Typical documents include a detailed business plan, financial projections, policies for credit risk, AML/CTF, governance framework, complaint handling, customer terms and contracts, and management / senior staff credentials.

How long does the authorisation process usually take?

The timeline varies depending on how complete and compliant your application is, how fast you respond to FCA requests for information, and complexity of your credit-offering model. It may take several months.

What compliance obligations apply after authorisation?

Once authorised, you must maintain adequate risk and compliance frameworks, submit regulatory reports, deal with customer complaints, ensure AML/CTF procedures are functioning, staff are trained, and stay updated with any regulatory changes.

What happens if a consumer credit firm fails to meet FCA requirements?

Failure to meet FCA requirements can result in refusal of licence, fines, enforcement action, reputational damage, and potentially being prohibited from carrying out regulated consumer credit business.

Consumer Credit FCA Authorization

Overview

: Firms offering lending, credit broking, debt adjusting/collecting, or consumer hire need authorisation under the Consumer Credit Act 1974 and FSMA.

Authorisation Process:

Scope Assessment: Identify regulated activities (e.g., credit broking, debt collection, high-cost short-term credit).
Business Model Drafting: Demonstrate fair treatment of customers, affordability assessments, and responsible lending.
Compliance Documentation: Prepare policies on Treating Customers Fairly (TCF), complaints handling, and vulnerable customers.
Financial Projections: Submit a clear three-year financial forecast and capital position.
Application Submission: Through FCA Connect – includes disclosures, policies, and responsible individuals.
FCA Review: Typically takes 3-6 months; may include a request for clarifications.
Ongoing Compliance Setup: Once authorised, firms must file regulatory returns and maintain FCA reporting standards.

Consumer Credit Firms

Overview

Authorisation Process:

We cover the following areas under Consumer Credit Firms: