FCA responds to Treasury Consumer Credit Act reform plans
FCA welcomed Treasury's policy statement on reforming the Consumer Credit Act 1974, signalling intent to consult on shifting consumer credit regulation from statute to FCA rules.
Treasury and FCA are moving towards a flexible, FCA-rules-based consumer credit regime, replacing prescriptive CCA requirements. This represents a major regulatory architecture shift for lenders, with significant implementation effort but greater long-term flexibility and competition.
Reform will reshape consumer credit compliance frameworks, documentation requirements, and conduct obligations across retail lending.
Action Required
Consumer credit firms should engage with upcoming FCA consultations and begin gap analysis between current CCA obligations and a future rules-based regime.
Most significant overhaul of UK consumer credit regulation in decades; affects all consumer credit lenders and intermediaries.
Track FCA consultations on CCA reform. Prepare impact assessment across pre-contract disclosures, agreement forms, and sanctions. Engage industry response and begin scenario planning for revised rules.
“The Treasury has published its policy statement on reform of the Consumer Credit Act 1974. The proposals place greater emphasis on FCA rules and guidance rather than prescriptive legislative requirements. The FCA intends to consult on key elements.”