The exact requirements that need to be met by an individual firm will depend on their specific consumer credit activities and their FCA authorisation status.
See the ‘FCA permission and authorisation' module for more information.
Beyond the principles of the FCA regime, the Consumer Credit Sourcebook (see also ‘Changes to consumer credit regulation' module) sets out the specific Rules and Guidance which the FCA expects firms carrying out consumer credit activities to follow. The distinction between Rules and Guidance in CONC is important for firms as the FCA will fully enforce its Rules, while firms have some discretion to interpret Guidance provided it is in accordance with the FCA's Principles and the spirit of the regulatory regime.
In addition, the FCA conduct Market Studies and Thematic Reviews which examine in detail particular products or markets as a whole. For example, in 2013/14 the FCA conducted a Market Study on General Insurance Add-On products. This included reviewing how GAP (Guaranteed Asset Protection) insurance was sold to consumers in motor dealerships. The outcome of the Review were new rules introduced for the sale of GAP insurance which we cover under module 5.
The FCA rules require firms to disclose their FCA regulatory status in a durable medium (e.g. in writing). This disclosure should be on all customer facing documentation (i.e. letter, e-mail, marketing flyers, websites, etc.).
A simple example of how this would look is shown below:
[Firm] is directly authorised by the Financial Conduct Authority (FCA) for consumer credit activities. Our Firm Reference Number (FRN) is .
The full rules can be found within the FCA’s GEN sourcebook.
Firms are also required to ensure they meet their obligations in regard to the Senior Managers and Certification Regime (SM&CR) especially in relation to its code of conduct and acting in the best interests of customers. See Senior Managers and Certification Regime below.