FCA cuts fees for consumer credit licences

The FCA has revised charges for consumer credit licences, with the minimum charge for full authorisation falling from £1,000 to £600.

The regulator previously published its consultation into consumer credit licences in November which stated application fees would be divided into four categories: straightforward cases costing up to £1,000; moderately complex cases up to £5,000; complex cases up to £10,000; and very complex up to £15,000.

In a supplement publication to the consultation published this week, the regulator says it has revised the proposals to merge the complex and very complex categories.

The regulator classes straightforward consumer credit activities as credit broking or providing credit information services. Moderately complex cases include operating an electronic system in relation to lending and debt administration.

Complex cases include providing credit references and debt counselling.

The changes mean there are now three categories of licences, based on income from consumer credit business. Licences will now cost: between £600 and £5,000 for straightforward cases; £800 to £10,000 for moderately complex cases; and £1,000 to £15,000 for complex cases. 

The paper says: “Fees should not unduly prevent firms from entering the market.”

The FCA is staggering the process to have all firms fully authorised by April 2016. Interim permissions cost £350 for firms and £150 for sole traders.

FCA chief operating officer Lesley Titcomb says: “We appreciate small firms already face a number of challenges so we want to ensure they can continue to operate successfully.”

Murphy Wealth associate partner Adrian Murphy says: “This is welcome pragmatism from the regulator to avoid rising costs for smaller firms.”

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