Consumer credit

Do I need a credit licence?

This will depend on what your business does. Under the Consumer Credit Act 1974 most businesses that provide goods and services on credit or for hire, lend money or provide debt collecting, debt counselling or debt adjusting services to consumers need to have a credit licence.

The Office of Fair Trading (OFT) is responsible for credit licensing.

The OFT website sets out the types of business which are likely to need a credit licence.

Office of Fair Trading (external website)

Important information

Some financial businesses are regulated by the Financial Services Authority (FSA). You may need to check with them as to whether or not you need to be authorised.

Financial Services Authority (external website)

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How do I make a credit licence application?

You can make an online application for a consumer credit licence using the Office of Fair Trading (OFT) website.

Office of Fair Trading (external website)

Important information

Before you make an application for a credit licence you should read through the information on the OFT website to make sure you understand whether you need a licence, the category of licence needed for your business, the information and supporting documents required and what fee you need to pay.

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Where can I go to get consumer credit advice?

The following organisations offer advice or information to businesses.

The Office of Fair Trading (OFT) is a central government body. Its role is to promote and protect consumer interests throughout the UK, while ensuring that businesses are fair and competitive.

Office of Fair Trading (external website)

The Department for Business, Innovation and Skills (BIS) is a central government department. One of its roles is to help to draft and regulate many of the UK laws, regulations and guidelines on advertising, package travel and timeshare, pricing and product description that help protect consumers and businesses from unscrupulous practices.

Department of Business, Innovation and Skills (external website)

GOV.UK website is a government online resource for all.  It has a section aimed at businesses and the self-employed. It contains essential information about starting up and running a business in the UK, including help if you're self-employed or a sole trader.

GOV.UK – Businesses and self-employed (external website)

Everything Regulation, Whenever It’s Needed (ERWIN) website has been set up by the East of England Trading Standards Association Limited (EETSA) to provide regulatory services information in an innovative way that will make it more accessible and useful to businesses.

Everything Regulation, Whenever It's Needed (external website)

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How do I make sure my credit adverts are legal?

The Office of Fair Trading (OFT) gives some guidance on credit advertising on its website.

Office of Fair Trading (external website)

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What fees can I charge as a credit broker?

The Consumer Credit Act limits a credit broker's charges to £5 if, following an introduction to a lender, an agreement is not signed within six months. If more than that has already been paid, brokers must refund the excess on request. 

Further information on what you need to know if you are a credit broker can be found on the credit brokers (information supplied by the Trading Standards Institute) page.

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When does the Financial Conduct Authority take over responsibility as the consumer credit regulator?

The Financial Conduct Authority (FCA) takes over from the Office of Fair Trading (OFT) as the consumer credit regulator on 1 April 2014. For more information on the changes and how they will affect your business, including an option to sign up for email updates visit the FCA website.

Financial Conduct Authority consumer credit (external website)

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