In April 2024, the Financial Conduct Authority (FCA) issued Policy Statement 24/3, confirming the enhancements to FCA reporting relating to consumer credit lending. This is the latest in the increase of RegData reports for lending firms; however, as we know, the FCA has transitioned to a data led supervisor and this brings consumer credit lending broadly in line with reporting seen in the Mortgage Lending sector.
What are the highlights and who does this affect?
The new reporting applies to all Consumer Credit lenders with outstanding balances and/or new advances of £2m or above. This data is already provided within the CCR003 report which will be used to trigger the enhanced Product Sales Data (PSD) reporting. The implementation period has been split so that firms conducting £20m and above, will be required to begin reporting in 2025 and those below £20m have until 2026 before these reports will be required. The implementation periods are quite long, presumably granted to allow firms to begin to capture the right information well in advance of the start of reporting, to ensure all firms can begin accurate reporting as soon as required.
New returns
There are three new returns in total which can be summarised as:
- The sales data report: this will allow the FCA to understand different aspects of new relevant regulated credit agreements entered into by the reporting firm, as well as provide contextualising information for the performance data reports in relation to these relevant regulated credit agreements.
- The performance data report: this will allow the FCA to understand the performance and outcomes of relevant regulated credit agreements. In particular, data elements in relation to the statements of running account credit and the scheduled repayments in respect of fixed-sum credit.
- The back-book data report: this is intended to provide contextualising information for the performance data report in relation to relevant regulated credit agreements, which have not been included in a sales data report.
What should Consumer Credit firms do now?
With just over 12 months to go until the first report is due for larger firms, they should not underestimate the granular level of detail required for these reports, all of which can’t be covered in this article given that the sales data report alone could collect up to 90 unique data elements per loan. However, the key message is to review the requirements in the policy statement and complete a gap analysis to determine whether or not you currently collect the data points required in good time prior to the reports being implemented.
The policy statement can be found here.
