The process by which consumer credit firms should apply to upgrade their authorisation with the Financial Conduct Authority (FCA) has commenced. When it took over as consumer credit regulator on April 1 2014, the FCA granted a status known as ‘interim permission’ to all previous holders of consumer credit licences who wished to continue trading.
Firms who hold interim permission will need to apply to the FCA to upgrade to either full permission (higher risk firms) or limited permission (lower risk firms). Firms can check which category applies to them at the official website of the FCA.
Each firm has been allocated a three month period in which their application must be made. When this period ends depends on the type of business carried out, and in some cases, on the firm’s postcode. For some debt managers and home finance intermediaries, this period has already commenced; hence, applications must be made by the end of 2014 for these firms. For those unsure, firms can check when their application period is. Interim permissions will lapse at the end of the relevant three month period, and any firm which does not submit its application within this time period will lose their authorisation.
For all firms, this application process will be completed by March 31 2016.
Firms can check the FCA’s credit ready limited permission checklist to see details of the information the FCA will require in an application. Applicants must meet the FCA’s Threshold Conditions.
Although most credit firms still hold interim permission, they are still subject to the detailed requirements of the FCA Handbook. Also, they can be subjected to disciplinary action if they do not follow these rules.