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Link to full consultation http://www.fca.org.uk/your-fca/docum...papers/cp14-08
These the most interesting bits....
''Debt advice
3.18 CONC 8.1.2R sets out the scope of application of CONC 8 (debt advice). We propose clarifying
that CONC 8.10 (providing credit information services) applies to firms operating an electronic
system in relation to lending (that is, peer-to-peer platforms) in relation to activities specified in
the Regulated Activities Order which are similar to providing credit information services.''
3.7 CONC 2.5.8R(12) requires credit brokers not to secure more credit for a customer than was
requested where the object of doing so is (or can reasonably be concluded as having been)
for the personal gain of the firm, rather than the best interests of the customer. We propose
extending this to securing credit at a higher rate of interest than was requested, in line with
paragraph 4.26e of the Office of Fair Trading (OFT)’s Credit Brokers and Intermediaries Guidance
(CBG).
3.9 CONC 3.5.7R(1) requires a financial promotion to include the representative annual percentage
rate of charge (APR) if it indicates any of the matters specified within this provision. There is a
similar provision at CONC 3.6.6R(1) in relation to the typical APR. We propose clarifying that an
indication may be express or implied (the present provision says an indication may be made ‘in
any way’) and to refer to ‘lender’ in the singular (the present provision refers to ‘in any case’).
3.10 CONC 3.9.3R(13) and (14) and CONC 3.9.5R(4) refer to payments to lenders. We propose
adding reference to owners under consumer hire agreements.
Post Contractual
3.13 CONC 6.7.4R states that a firm must first allocate a repayment under a credit card or store card
to the debt subject to the highest rate of interest. We propose clarifying that this applies to
each allocation of the repayment, and not merely the first allocation.
3.14 CONC 6.7.9R requires firms to notify the customer at least 30 days before a credit limit increase
comes into effect under a credit card or store card agreement, unless the customer requests a
temporary increase to deal with an emergency situation and a creditworthiness assessment is
undertaken. We propose requiring firms to notify a proposed increase in the credit limit at least
30 days before the increase comes into effect, except where:
i. the increase is at the express request of the customer, or
ii. the increase is proposed by the firm but the customer agrees to it at that time and wishes it
to come into effect in less than 30 days.
3.15 This allows more flexibility to both parties but with the customer being in control in terms of
whether to accept the increase and its timing.
3.16 CONC 6.8.4R states that where section 155 of the Consumer Credit Act 1974 (refund of credit
brokerage fees) applies, a firm must respond to a request for a refund. We propose adding
that if a firm has not entered into a relevant agreement within six months of an introduction to
a potential source of credit, the firm must – as soon as reasonably practicable after the expiry
of the six-month period (which we consider should be within five working days of the expiry)
– clearly bring to the customer’s attention the right to request a refund under section 155 and
how to exercise that right. This is in line with paragraph 6.19d of the CBG.
Arrears, default and recovery
3.17 CONC 7.9.12R requires a firm to ensure that a person visiting a customer on its behalf clearly
explains the purpose and intended outcome of the proposed visit and gives the customer
adequate notice of the date and likely time of the visit. We propose clarifying that this applies
unless it is not practicable for the firm to comply. In addition, we propose amending CONC
7.9.13G to make clear that failure to explain the purpose and intended outcome in advance of
an initial debt collection visit may not contravene the rule, provided that the customer is happy
to speak to the person pursuing recovery of the debt at that time.
These the most interesting bits....
''Debt advice
3.18 CONC 8.1.2R sets out the scope of application of CONC 8 (debt advice). We propose clarifying
that CONC 8.10 (providing credit information services) applies to firms operating an electronic
system in relation to lending (that is, peer-to-peer platforms) in relation to activities specified in
the Regulated Activities Order which are similar to providing credit information services.''
3.7 CONC 2.5.8R(12) requires credit brokers not to secure more credit for a customer than was
requested where the object of doing so is (or can reasonably be concluded as having been)
for the personal gain of the firm, rather than the best interests of the customer. We propose
extending this to securing credit at a higher rate of interest than was requested, in line with
paragraph 4.26e of the Office of Fair Trading (OFT)’s Credit Brokers and Intermediaries Guidance
(CBG).
3.9 CONC 3.5.7R(1) requires a financial promotion to include the representative annual percentage
rate of charge (APR) if it indicates any of the matters specified within this provision. There is a
similar provision at CONC 3.6.6R(1) in relation to the typical APR. We propose clarifying that an
indication may be express or implied (the present provision says an indication may be made ‘in
any way’) and to refer to ‘lender’ in the singular (the present provision refers to ‘in any case’).
3.10 CONC 3.9.3R(13) and (14) and CONC 3.9.5R(4) refer to payments to lenders. We propose
adding reference to owners under consumer hire agreements.
Post Contractual
3.13 CONC 6.7.4R states that a firm must first allocate a repayment under a credit card or store card
to the debt subject to the highest rate of interest. We propose clarifying that this applies to
each allocation of the repayment, and not merely the first allocation.
3.14 CONC 6.7.9R requires firms to notify the customer at least 30 days before a credit limit increase
comes into effect under a credit card or store card agreement, unless the customer requests a
temporary increase to deal with an emergency situation and a creditworthiness assessment is
undertaken. We propose requiring firms to notify a proposed increase in the credit limit at least
30 days before the increase comes into effect, except where:
i. the increase is at the express request of the customer, or
ii. the increase is proposed by the firm but the customer agrees to it at that time and wishes it
to come into effect in less than 30 days.
3.15 This allows more flexibility to both parties but with the customer being in control in terms of
whether to accept the increase and its timing.
3.16 CONC 6.8.4R states that where section 155 of the Consumer Credit Act 1974 (refund of credit
brokerage fees) applies, a firm must respond to a request for a refund. We propose adding
that if a firm has not entered into a relevant agreement within six months of an introduction to
a potential source of credit, the firm must – as soon as reasonably practicable after the expiry
of the six-month period (which we consider should be within five working days of the expiry)
– clearly bring to the customer’s attention the right to request a refund under section 155 and
how to exercise that right. This is in line with paragraph 6.19d of the CBG.
Arrears, default and recovery
3.17 CONC 7.9.12R requires a firm to ensure that a person visiting a customer on its behalf clearly
explains the purpose and intended outcome of the proposed visit and gives the customer
adequate notice of the date and likely time of the visit. We propose clarifying that this applies
unless it is not practicable for the firm to comply. In addition, we propose amending CONC
7.9.13G to make clear that failure to explain the purpose and intended outcome in advance of
an initial debt collection visit may not contravene the rule, provided that the customer is happy
to speak to the person pursuing recovery of the debt at that time.
