Consumer credit and regulated activities

Offering credit to consumers usually needs FCA authorisation, including simple payment plans.

What it means

Providing credit to individuals, or broking it, is a regulated activity requiring FCA authorisation unless an exemption applies.

Why it matters

Businesses offering instalment plans, deferred payment or interest-free terms to consumers are frequently carrying on a regulated activity without realising it.

What it looks like in practice

Some exemptions exist — for example certain agreements with limited numbers of instalments and no interest — and they are narrower than people assume.\n\nBuy now pay later regulation has been changing; check the current position.

What to watch out for

Carrying on a regulated activity without authorisation is a criminal offence and can make the agreement unenforceable, meaning you cannot recover the money.

Where to get proper advice

The FCA's perimeter guidance, and a compliance consultant or solicitor before offering any payment plan to consumers.