First to the finish line or long term relationship?

In many articles about the transfer of authorisation of consumer credit business from the Office of Fair Trading in April 2014, I’ve seen reference to an ‘introduction’ to the Financial Conduct Authority (FCA).  In fact, for many of the firms encountering the FCA for the first time, I imagine that the application process has felt less like a speed-dating session and more like a full scale military interrogation!

In order for those firms which conduct consumer credit business to be currently trading legally, they must either have interim permissions in place or have achieved authorisation.  Although some of you will have by now moved onto the next stage of your regulatory journey and will already be enjoying full immersion into the FCA regime, many consumer credit firms are still operating with Interim Permissions, either currently undergoing the full application process or awaiting the start of their 3 month application window. If you are in the latter of those two groups, you will receive an FCA communication when it’s your time to apply, giving you a three month window in which to submit your application.  I can’t stress this point enough; it’s always better to engage with the regulator and get this process started as soon as possible.

Whilst it’s been a few years since I was at school, but I like to equate the difference between getting your homework done on a Friday evening versus trying to cram it all in on a Monday morning before double maths; a bit of a pain at the time, but unquestionably worth it for the peace of mind once it’s off your shoulders and you’re able to buy yourself a bit of breathing space in case you’ve made any mistakes or have missed a page.  And this is where the homework analogy ends; if you fail to submit your application to the FCA you will be unable to continue to trade legally. 

The first thing you’ll need to know before you apply is whether you need full or limited permissions.  Which level of permissions you need is dictated by the type of business you conduct – if you’re applying through a service provider like the Consumer Credit Centre then we will help you determine what you need.  If you’re going solo, I would urge you to take a good look at the FCA’s site to confirm what you need to do.  Setting off down the wrong path will be a waste of both your time and money. 

The regulator will require a host of information from you; exactly what will differ depending on whether you’re going for full or limited permissions.  In the interests of covering all the bases, and because it’s the category into which many consumer credit firms fall, I’m going to look at the requirements for applying for full permissions. 

Initially, you’ll be required to fill in a questionnaire with details of your company including a detailed business plan, the types of business you conduct, and the types of business you don’t conduct.  For firms submitting this information for the first time, it can be heavy going and there’s the added risk that if you accidentally omit any sections, or misunderstand what is being asked of you, you may need to re-submit everything from scratch, particularly details which are time sensitive.  In addition, you will be asked to complete a ‘Form A’ for any directors of the firm, further forms for anyone who is a ‘controller’, submit a full copy of your latest set of accounts, produce financial forecasts and create an online account for the FCA’s ‘Connect’ system.  Even if you already hold all the data needed for your application, be aware that the regulator will require it to be presented in a highly specified format and just collation of the information might take some considerable time. 

As you would expect, I fully recommend working with the Consumer Credit Centre which has experience of dealing with the FCA and is familiar with the application process.  Partnering with a professional support firm means you’re more likely to get it right first time – in fact, we have a 100% success rate in getting firms through the application process – and the savings, in both finances and time, can be huge. 

I think we can all appreciate that the FCA’s core objective – to ensure consumers are dealt with in a clear and fair manner – is admirable.  However, the process to get to that point can, at times, seem overwhelming for firms who are new to this regulatory regime.  Especially when you consider that everything pertained to in this article refers solely to achieving authorised status; beyond this point there’s a whole new world of rules and reports and processes and procedures with which you will need to become familiar.

It will doubtlessly be a sharp learning curve for the majority of firms but help is out there, and starting as early as you can puts you in a very strong position for what is to come. 


David Golder

Managing Director

Consumer Credit Centre

The SimplyBiz Group