Without that balance, reforms risk reducing competition and narrowing consumer choice – the very opposite of what’s intended. On redress reform, our focus has been on practical solutions – scaling thresholds, reforming case fees, and embedding proportionality – so that the system works in practice, not just in theory.

The FCA and FOS are consulting on reforms to the UK’s redress system. On paper, this might sound like a technical exercise. In practice, it will shape how complaints are handled, how costs are shared, and ultimately whether smaller, specialist lenders can continue to serve their customers.

At the CCTA, we’ve been engaging with members, regulators, and other stakeholders throughout this process. Our response welcomes the ambition to modernise and bring greater predictability. But we’ve been clear: the regime must work for all firms, not just the most prominent players.

Why does this matter? Because thresholds that are trivial for a high-street bank can be existential for a smaller lender. Because the case fees that larger firms can absorb will drive smaller firms into collapse. And because when those firms disappear, consumers don’t just lose a complaints process – they lose access to credit entirely.

1. A proportionate definition of “Mass Redress Events,” so the framework recognises the realities of niche markets.
2. Reporting triggers that scale with firm size, ensuring early warnings across the entire sector.
3. Comprehensive case fee reform, with protections against unlimited exposure to meritless claims.
4. Safeguards around the new lead complaints process — time limits, transparency, and fair treatment for vulnerable consumers.
5. DISP guidance that is practical, proportionate, and sector-aware.

The direction of travel is correct, but without these changes, there’s a real risk that reform could accelerate small firm failures, reduce consumer choice, and ultimately undermine financial inclusion.

Our message is simple: redress reform must be fair, predictable, and sustainable. That’s how we protect both firms and the consumers who rely on them.