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Credit Broking- a brief FCA guide

At MEMA, we believe in upskilling our readers and clients as much as possible. We will be releasing brief explanations into Financial Conduct Authority (FCA)-regulated areas, so you can understand quickly what are the requirements in that area. Our first area will be Credit Broking.


Credit broking definition


Credit broking can occur in two types of use cases.

  1. when a business introduces a customer to a finance or credit provider

  2. a customer has been introduced to another credit broker, who then introduces them to a finance or credit provider

An example of credit broking might be where a customer is looking for a loan online and uses a business to find or recommend a finance or credit provider.


Credit broking permission guide


Credit broking includes making introductions for individuals seeking a credit agreement or consumer hire agreement, an example is short-term credit

  • This covers regulated credit agreements and regulated consumer hire agreements

  • Where credit broking activity is secondary to your main business activity such as selling motor vehicles, you will require limited permission credit broking permissions

  • Depending on your proposed business model you may fall into one of two types of credit broking activities, Full Authorisation or Limited Permission Credit Broking