The registration process has opened for companies with a valid consumer credit licence to gain interim permission to trade under the regulation of the Financial Conduct Authority (FCA).
Interim permission will allow a business to continue to offer retail finance after 1 April 2014, when regulation of consumer credit moves from the Office of Fair Trading to the FCA, which succeeded the Financial Services Authority in April this year.
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Firms holding a consumer credit licence which do not apply for interim permission will not be allowed to offer financial services until granted full permission by the FCA.
The fee for interim permission is set at £150 for sole traders and £350 for other businesses.
Appointed and Approved
Applications for interim permission may be submitted online and will include voluntary information regarding turnover, transactions, complaints, locations, use of agents and more.
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By GlobalDataAs of 1 April, the FCA will review applications for full authorisation from those firms who have been granted interim permissions.
Karen Wagstaffe, training and compliance director at Finance Cover & Training, pointed out a firm may become exempt from the procedure if it operates as an Appointed Representative of an authorised business, as it is the latter which is responsible for the finance business of the Appointed Representative in the eyes of the FCA.
Of particular note, said Wagstaffe, were motor dealerships: "Many of your finance house partners will not permit you to become an Appointed Representative of another firm so this may not be an option for you. You should check and confirm this with your finance house partners".
Those directors, senior managers and individuals within a company responsible for compliance, therefore managing a controlled function, must also be authorised as an Approved Person, once vetted by the FCA and subject to a Code of Practice.
Time for change
Given the scale of administration required at the FCA, Wagstaffe encouraged companies to apply "promptly" in the autumn or winter of 2013, while the Finance & Leasing Association has spoken of its apprehension over the timescale for change.
However, the FCA has said it is confident it will meet its 1 April deadline.
Last week independent car finance provider Alphera Financial Services also urged its partners to read the March Consultation Paper regarding the changeover to the FCA and take part in a series of upcoming workshops with the BMW-owned lender to prepare for the regulatory shift.
Are you applying for interim permission with the FCA? What has your company done to prepare for the change of regulator? Send us your comments at the e-mail address below.
richard.brown@timetric.com
