Categories of consumer credit not included in Institute’s group licence

(The following extract is included for information purposes only – the Institute’s Group Licence has now ceased)

The remaining four categories of consumer credit that are not included in Institute’s group licence  (information is provided below on each of these categories. The number in brackets is the article number in the Regulated Activities Order where the new definitions after 1 April will sit):

Consumer hire

You will need this category to hire, rent out, or lease goods under any regulated agreements, and where the arrangement is capable of lasting for more than three months.
In such cases the ownership of the goods or services being hired does not transfer to the consumer. An example would be a rental package for TV, phone and broadband, but not a hire purchase agreement.

Debt collecting

You will need this category if you take steps connected with the collecting of debts owed to others under any regulated consumer credit or hire agreements and you will simply be collecting those debts on the third party's behalf.

This category is not needed if you will only collect debts owed to you.

Credit reference agency

This category will only be relevant to businesses that collect, and then provide others with, information relevant to someone's financial standing, and the information collected has been collected for that purpose. Only those who carry out similar functions to the three largest consumer credit reference agencies in the UK will need this category.

If you simply give a reference at the request of a credit provider (with the client’s permission) this category is not needed.

Peer-to-peer lending (this is a new category of consumer credit)

FCA plans to introduce a new category of credit activity to cover peer-to-peer lending. The actual regulated activity is operating an electronic system in relation to lending. This is the system that matches up potential borrowers with others who have funds available for lending.

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