The Finance & Leasing Association (FLA) will respond to the latest consultation from Financial Services Authority (FSA) by the end of October.

The FLA is going through the consultation with relevant committees and hosting a pair of round tables on protection of consumer credit at the national conferences of both the Liberal Democrat and Conservative parties, confirmed Ed Simpson, head of government affairs at the FLA.

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Following a review of the mis-selling of payment protection insurance, Martin Wheatley, head of the FSA and soon-to-be head of the body’s replacement, the Financial Conduct Authority, launched a press-heavy campaign against commission-based sales in all finance markets.

Different risk

Speaking to Motor Finance, Simpson said the round tables allowed attendees, including lenders and retailers, to “thrash out what the new regime may look like and any potential pitfalls.”

At the first round table, held on Monday at the Liberal Democrat conference, Simpson said there had been a “recognition that the government has to recognise the specifities of our market.

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“The nub is that the current FSA regime for deposit-taking won’t work for credit. The risk is different. If a lender goes to the wall they lose money, the consumer doesn’t suffer.”

Paul Harrison, head of motor finance at the FLA, said Wheatley’s proposals were to be expected and reflected the regulatory “move to greater transparency” which the Association supported if it reduced “risk and possible detriment to customers.”

Further comment and analysis of the FSA consultation will be published in the September issue of Motor Finance magazine.

peter.johnstone@vrlfinancialnews.com

richard.brown@vrlfinancialnews.com