If your business lends money or offers credit, it’s vital to know whether you need authorisation from the Financial Conduct Authority (FCA).

In most cases, the answer is yes. FCA registration is a legal requirement for firms involved in regulated lending. So, if a firm is engaging in activities such as:

• Lending money
• Selling goods on credit
• Offering credit cards
• Arranging credit for others
• Collecting or buying consumer credit debts
• Providing debt advice or services

Then they must be authorised by the FCA.

Exceptions

There are minimal exceptions to this for lower risk, short term arrangements. One exception is interest free instalment credit rule. If the credit agreement is less than 12 months, Repayment must be no more than 12 instalments, and no interest or other fees can be charged. If these conditions are met, the lender does not need FCA authorisation.

Example: Buy now pay later (BNPL) providers like Klarna who have become very popular for online shoppers as well as similar firms have historically practiced under this exemption for certain products. However, with the everchanging landscape of the FCA and UK government there is a chance BNPL agreements will come into regulation. But as of yet nothing is confirmed.

How We Can Help

Getting FCA authorisation doesn’t have to be complicated. At The Compliance Guys, we help lenders and credit firms understand the rules, navigate applications, and stay compliant with confidence.

Email: sales@thecomplianceguys.co.uk
Call: 01792 926 040

Speak to our team today and let’s simplify compliance together.