The Financial Conduct Authority will take over the regulation of consumer credit from the Office of Fair Trading on 1 April 2014, replacing the Financial Services Authority.
All firms which currently hold a Consumer Credit Licence (CCL) will only be able to trade under their existing CCL until midnight of 31 March 2014. If businesses want to continue to carry out regulated consumer credit activities in April and beyond, they must contact the FCA before 31 March.
Those businesses holding a valid consumer credit licence will be able to continue carrying out credit business covered by their licence on and after 1 April 2014 if they register for an 'interim permission' from the FCA and pay the appropriate fee.
John Thompson, chief executive of the Association of Plumbing & Heating Contractors, said: “We believe that there are a number of firms in the industry who have yet to deal with transfer arrangements. If firms do not register for ‘interim permission’ from the FCA before 1 April, and continue to provide consumer credit, they may be acting illegally and contracts may be unenforceable.
“Providing or arranging consumer credit without a licence is a criminal offence and can result in a fine and/or imprisonment. Businesses cannot legally enforce a credit agreement if they are not licensed.”
Businesses with an up-to-date OFT licence need to:
If business owners let their licence lapse before the changeover, they will not be able to engage in licensable credit businesses until they are appropriately licensed again. Only those businesses holding valid consumer credit licences will be able to obtain an interim permission.