FCA Motor Finance Redress Scheme: What CP25/27 Proposed and How It Was Finalised
The October 2025 CP25/27 motor finance redress proposals and how the FCA finalised them in PS26/3 on 30 March 2026, with an estimated £7.5 billion cost.
Read the guideSPECIALIST SERVICES
FCA Regulated • Limited & Full PermissionsConsumer Credit Regulatory Support
Permissions, controls and customer outcomes around the real business model.
Comprehensive FCA regulatory support for consumer credit activities including lending, credit facilitation, debt management, and debt collection. We help you meet FCA requirements to lend responsibly, treat customers fairly, and maintain robust compliance monitoring.
SERVICE OVERVIEW
Consumer Credit Authorisation and Compliance
Set up or strengthen consumer-credit permissions, controls and customer outcomes around the real business model.
Lenders, credit brokers, debt administrators, collectors and firms offering regulated credit activity. A clear permissions route and practical framework across CONC, Consumer Duty and monitoring.
Evidence we help you build
- Consumer-credit perimeter and permissions analysis
- Business plan and CONC control framework
- Customer journey and vulnerability evidence
- Monitoring, complaints and outcome reporting
Typical timeframe
Ready to submit within 6 weeks, often sooner
Under FSMA the FCA must decide within 6 months of receiving a complete application, or within 12 months of receiving an incomplete one.
Ideal for
- Lenders
- Credit brokers
- Debt administrators and collectors
- Firms offering regulated credit activity
Permission types
- Limited Permission: Secondary or Complementary Activities
- Full Permission: Primary Business Activity
How MEMA helps you
- Business Assessment
- Regulatory Business Plan
- Application Support
- Ongoing Compliance
- Policies & Procedures
- Compliance Monitoring
Consumer Credit Activities We Support
Regulatory guidance across all consumer credit sectors
Lending
Credit Facilitation
Debt Management
Debt Collection
Consumer Credit Permission Types
The FCA offers two types of consumer credit permissions based on your business model
Limited Permission
Secondary or Complementary Activities
For firms where consumer credit is not the primary business activity
- Consumer credit activities are ancillary to main business
- Simplified application process
- Lower regulatory burden
- Suitable for businesses offering credit as a secondary service
Full Permission
Primary Business Activity
For firms whose main business involves consumer credit activities
- Consumer credit as core business function
- Comprehensive regulatory requirements
- Full FCA supervision and oversight
- Required for lending, debt collection, or credit broking as primary activity
Core FCA Requirements
Essential compliance obligations for consumer credit firms
Lend Responsibly
What responsible lending requires in practice.
- Comprehensive affordability assessments
- Creditworthiness checks and verification
- Appropriate lending decisions based on customer circumstances
- Fair pricing and interest rate structures
Treat Customers Fairly
What fair treatment requires in practice.
- Clear and transparent communication
- Fair treatment throughout customer lifecycle
- Appropriate support for customers in financial difficulty
- Complaints handling and resolution procedures
Compliance Monitoring
What compliance monitoring requires in practice.
- Regular compliance oversight and reviews
- Management information and reporting systems
- Internal audit and quality assurance
- Ongoing regulatory change tracking
What you will need to produce
- Consumer-credit perimeter and permissions analysis
- Business plan and CONC control framework
- Customer journey and vulnerability evidence
- Monitoring, complaints and outcome reporting
Map the consumer-credit activity
Permissions and controls follow the activity the firm actually carries on.
- Activity perimeter
- Separate lending, broking, administration, debt counselling and collection roles.
- CONC controls
- Translate the relevant CONC expectations into customer, staff and system processes.
- Customer journey
- Review affordability, vulnerability, communications, support, complaints and collections.
Monitor outcomes across the book
A sustainable framework links customer evidence to management action.
- File and journey testing
- Test decisions, disclosures, records, customer support and treatment of customers in difficulty.
- MI and complaints
- Use outcome measures, root causes and complaints to identify emerging issues.
- Remedial action
- Assign owners and evidence for changes to policies, controls, training and customer processes.
The Consumer Credit Compliance journey
The route from scoping your permissions to a decision. The FCA's part of it is fixed; the preparation before it is where applications are won or lost.
- 1Identify which credit activities you carry onLending, broking and debt administration are separate permissions, and firms often hold a different combination from the one their business needs.
- Map each credit activity to the permission it needs
- Confirm whether limited or full permission is the route
- Identify exclusions that change the answer
- 2Build the conduct frameworkConsumer credit is judged on customer outcomes across the book, so the evidence has to cover the customer journey and not only the policies. CONC is the FCA sourcebook those standards sit in.
- Write policies and controls to the conduct standards that apply
- Evidence affordability, arrears and vulnerability arrangements
- Set up monitoring that shows what customers experienced
- 3Submit to FCASubmitted through the FCA's Connect portal with the application fee of £560 – £11,260.
- Complete submission through Connect
- Application fee paid at submission
- Case officer assigned by the FCA
- 4FCA reviewThe statutory determination period is 6–12 months — six months for a complete application, twelve if it is incomplete when submitted.
- Case officer raises questions on the submission
- Further information requests answered and evidenced
- Weak responses, not complexity, are the common cause of delay
- 5Permission grantedPermission is granted and the firm can carry on the regulated activity, subject to any requirements attached to it.
- Permission recorded on the Financial Services Register
- Any limitations or requirements confirmed
- Reporting and supervision obligations begin
What our consumer credit support covers
Pre-Authorisation Services
Comprehensive support to help you achieve FCA consumer credit authorisation
Business Assessment
- Detailed fact-finding and business model analysis
- Activity classification and permission scoping
- Threshold conditions assessment
- Gap analysis against FCA requirements
Regulatory Business Plan
- Comprehensive business plan preparation
- Financial projections and capital adequacy
- Risk assessment and mitigation strategies
- Compliance monitoring framework design
Application Support
- FCA Connect application completion
- Supporting documentation preparation
- FCA query response management
- Application tracking and liaison
Post-Authorisation Services
Ongoing compliance support to maintain your FCA authorisation
Ongoing Compliance
- Regular compliance health checks and reviews
- Regulatory change impact assessments
- FCA return and reporting support
- Annual compliance monitoring oversight
Policies & Procedures
- Comprehensive compliance manual development
- Policy and procedure documentation
- Staff training materials and programmes
- Regular policy review and updates
Compliance Monitoring
- Monitoring plan design and implementation
- Management information framework
- File review and quality assurance
- Compliance testing and reporting
How MEMA helps
Consumer credit is judged on customer outcomes across the whole book, so the work runs from getting the permission right to being able to show what happened after.
- 1Map the credit activityWhich consumer-credit activities you carry on and which permissions they need — lending, broking, debt administration and the rest are separate permissions, and firms routinely hold the wrong combination.
- 2Build the CONC frameworkPolicies and controls built to the conduct standards that apply to the activity, written for the staff who will operate them.
- 3Work the customer journeyPre-contract disclosure, affordability, arrears and forbearance reviewed end to end, because that is where consumer-credit outcomes are actually decided.
- 4Evidence vulnerability and fair treatmentThe identification and support arrangements for customers in difficulty, documented so they can be tested rather than asserted.
- 5Monitor outcomes across the bookFile review, complaints analysis and management information that show what customers experienced — the evidence a supervisor asks for first.
Related FCA Guidance
Deeper reading on the regulatory framework behind consumer credit.
- Compliance Monitoring ProgrammeBuilding a risk-based monitoring plan that tests customer outcomes, not just policy existence.
- CONC: Consumer Credit SourcebookThe FCA rules covering lending, broking, debt management, and credit information.
- Consumer Credit AffordabilityAffordability assessment requirements and how the FCA measures responsible lending.
- FCA Authorisation EvidenceWhat evidence the FCA expects to see in your authorisation application.
Before you apply: free consumer credit tools
Check how ready your firm is and whether your business model needs authorisation, before you start an application.
- Will the FCA authorise a consumer credit firm?A free two-minute readiness check for a consumer credit authorisation application.
- Perimeter check: consumer lenderAn initial view of whether lending to individuals or sole traders needs FCA authorisation, and the likely route.
- Perimeter check: credit brokerAn initial view for firms that introduce customers to lenders for a fee without lending.
- Perimeter check: motor finance brokerAn initial view for firms that arrange vehicle finance as their main business.
- Perimeter check: car dealer offering financeAn initial view for dealers that sell vehicles and introduce customers to finance lenders.
- Perimeter check: debt management firmAn initial view for firms that advise customers on debts and negotiate with creditors.
- Perimeter check: credit lead generatorAn initial view for firms and comparison sites that introduce consumers to lenders online.
Once authorised: free compliance monitoring tool
A free pack for the ongoing monitoring a consumer credit firm needs to evidence.
Not sure whether limited or full permission applies to your consumer credit activity? Our fixed-fee regulatory perimeter assessment gives a written answer, and secondary credit brokers who already know they need limited permission can go straight to the limited-permission credit-broking authorisation project. Already authorised? Our free FCA reporting calendar shows the RegData returns likely to apply to your firm and when each one is due. Applying for permission for the first time? Our page on consumer credit authorisation covers the sector-specific requirements.
Expert Consumer Credit Guidance
Our team of ex-regulators and compliance specialists brings deep expertise in consumer credit regulation. We provide practical, tailored solutions to help you meet FCA requirements and maintain ongoing compliance in this complex and evolving regulatory landscape.
- Responsible Lending
- Fair Treatment
- Robust Monitoring
Case Study
Compliance function stabilised after a sudden departure
The firm's compliance resource left without warning. Nobody owned its regulatory obligations, and the gap created both regulatory risk and key-person risk.
A stable compliance footing restored, with no FCA escalation during the gap.
Sectors We Support
This service is available for firms across these regulated sectors
Explore our other services
End-to-end support across the full regulatory lifecycle.
Frequently asked questions
Which consumer-credit activities need to be mapped?
The analysis may include lending, credit broking, debt administration, debt counselling, collection and related activities. The firm's actual customer and contractual journey determines the permissions questions.
What does responsible lending evidence involve?
The framework should connect affordability and creditworthiness, vulnerability, product design, customer communications, support and monitoring to the firm's decisions and outcomes.
How does CONC fit into the service model?
The relevant CONC requirements should be translated into policies, processes, controls, staff responsibilities and file or outcome testing that reflect the business model.
What should ongoing monitoring cover?
Monitoring can cover customer files, promotions, complaints, affordability, vulnerability, collections, outcomes, governance MI and the remediation of issues identified.
Need Consumer Credit Regulatory Support?
Contact our expert team for guidance on consumer credit authorisation and compliance
Phone: 0330 133 0811
Email: contact@memaconsultants.com