A big area we have seen movement on is the review of the Consumer Credit Act (CCA) which has been in the pipeline for some time. Given the Act has been part of the legislative framework for fifty years, a review of the Act is a big undertaking.

Phase one of the consultation was published in May and closed recently. This focused on information requirements, sanctions and criminal offences. Our approach to the review remains questioning the move from the prescriptive CCA framework to the outcomes-based approach of the FCA. We want to make sure firms know what is required of them and that isn’t open to interpretation down the line. It is especially important for small businesses to know where they stand.

Because this is such a big project, phases one and two will overlap. Phase two will look at issues including consumer rights and protections, scope and definitions and crossing cutting themes including green and Islamic finance.

Phase two is expected towards the end of the year and could push into 2026. The CCTA team continue to be involved in accompanying policy roundtables with the Treasury.

At the same time as the CCA consultation, we also saw the Government response that was expected on regulating Buy-now Pay-later products (BNPL).

This is to bring BNPL products under FCA regulation. The necessary changes needed to legislation have been laid in Parliament and the FCA has now published a consultation on rules and guidance they will apply to the sector. The FCA has twelve months to finalise these plans before they become responsible for the sector in mid-2026.

If any retail credit members have any concerns about the proposed rules please get in contact with the team.

Finally connected to the Treasury, is the Government’s National Financial Inclusion Strategy, which was promised in the Labour manifesto.

In the spring, we saw the Minister bring together a committee tasked with developing the Strategy. We have also seen the establishment of sub-committees including one on access to credit chaired by Fair4all Finance.

We have had some involvement with the project so far but have expressed the view that small and specialist lenders in the commercial sector need to be part of this debate. We all know a balanced solution is needed. We should see publication of the full strategy this autumn.

Turning attention to motor finance, the industry is waiting with bated breath for the decision on commissions from the Supreme Court before anything can move forward. The FCA has said that they will confirm within six weeks of the SC decision, if they are proposing a redress scheme. They are aware the industry needs clarity.

Elsewhere the new Product Sales Data reporting gets underway for consumer credit shortly. Depending on firm size, reporting will either start in Q3 of this year or Q1 of 2026. We are still raising member queries around reporting with the FCA so do get in touch if you have any concerns.

Finally, on the FCA, a call for input was issued last year reviewing FCA requirements that may no longer be needed, considering the Consumer Duty. The regulator identified some immediate areas for action in March. These include a review of the advertising rules for consumer credit where they will consult on outdated requirements. The FCA will publish a further statement of work in September which we will be watching for.

There has also been a lot of activity at the FOS. The Economic Secretary launched a review of the FOS earlier this year to tackle concerns that it was behaving like a quasi-regulator. The findings were released in mid-July and the Treasury has issued a
consultation to seek views on the proposed changes.

In conjunction with the FCA, the FOS also issued a call for input on modernising the redress system. We submitted a lengthy response to this picking up on issues including time limits and the role of CMCs.

Again, a follow up consultation has just been issued to make the system better serve consumers and give firms greater certainty to invest and innovate.

Finally on the FOS, a consultation just closed on the rate of interest FOS applies to compensation awards. This currently stands at 8% but we have argued for a long time that this is too high and doesn’t reflect economic conditions.

The Ombudsman recommended moving to a tracker rate that is linked to the Bank of England base rate. We were supportive of this and called for it to implemented as soon as possible.

And it seems things are happening quickly as within weeks of the consultation closing, the FOS confirmed it will move ahead with its recommended approach, likely to come into effect from next year. This is welcome development along with the charging of CMCs that commenced in April.

So, it is fair to say there is a lot happening. Though these developments will mean changes for firms, they cover several areas the CCTA has campaigned for many years, to improve the regulatory environment for firms. We will continue to ensure your views are represented through this process.