Consumer Credit

Question 1

What is CONC?

Answer 1

It is the Consumer Credit Sourcebook as a result of FCA taking over regulation of consumer lending from the Office of Fair Trading in April 2014 - and implements Consumer Credit Acts of 1974 & 2006

Question 2

What does CONC contain?

Answer 2

FCA rules for :
- Marketing
- Selling
- Disclosure
- Customer information
- Debt Handling 
- Administration of consumer credit
& Fair Treatment of customers

Question 3

What are the main provisions of the Consumer Credit Act 2006?

Answer 3

• There is generally no limit to the amount of loan covered by the Act
• Borrowers protected are unincorporated, partners three or less or soletrader any others outside the scope
• Complaints can be taken to the Financial Ombudsman
• Easier to challenge unfair lending practices and loan agreements

Question 4

WHo are exempt from regulated authority under the Financial Services and Markets Act 2000

Answer 4

• Agreements with limited companies and LLPs
• Agreement where it is for business purposes predominantly and over £25K - if any doubt about business use it is regulated such as part business car and personal car
• Agreements with high net worth individuals, net income of £150K or more and net assets (excluding pension and main residence) of at least £500K
• Regulated mortgages - these are covered by separate FCA rules

Question 5

What are the six categories of regulated activities?

Answer 5

• Credit broking
• Debt related activities (debt adjusting, debt counselling, debt administration and debt collecting)
• Entering into a regulated consumer hire agreement as an owner
• ’’ ‘’ as a lender
• Providing credit information services and credit references
• Operating an electronic system in relation to lending