On 12 September 2024, the FCA published a consultation on proposals to issue a new regulatory reporting return for consumer credit firms that engage in one, or more, of the regulated activities of Credit Broking, Debt Adjusting, Debt Counselling and Providing Credit Information Services.

This is part of the FCA's multi-year plan to review and replace all of the regulatory returns for consumer credit regulated activities and follows the publication of PS24/3, which introduced three new Product Sales Data returns for consumer credit lending firms.

The FCA is seeking to improve the information it collects from firms to better understand their consumer credit activities and proactively supervise them to identify and prevent risk of harm to consumers earlier. The design of the new return aims to tailor the set of questions so they are more readily aligned to firms’ business model and activities and use common industry terminology to help improve understanding. The return will include five mandatory sections of questions all firms in scope will be asked, including:

1. Permissions – regarding the regulated activities the firm has undertaken in the past 12 months (or why the firm has not used their permission).
2. Business model – regarding the financial products, goods, and/or services that firms are providing to consumers.
3. Marketing – regarding the channels firms are using to target consumers.
4. Revenue – total revenue from credit-related activities and non-credit related activities.
5. Employees – details of total number of employees by FTE number of sales/advice staff and commission model and details of training and compliance.

Following these five sections, questions will be customised according to the permissions the firms hold. For example, if a firm’s responses to the mandatory questions identify them as a secondary broker with limited permission to introduce a consumer to finance a product or service, they will be presented with questions pertaining to the product and service they are broking.

The consultation is closing on 31 October 2024. The FCA is proposing that the rules come into effect immediately with the publication of the Policy Statement which is expected to be early in Q1 2025. In the meantime the FCA should have shared a prototype of the return with firms in scope before the end of September 2024. The prototype will allow firms to view the returns in a similar way to how they will be required to submit the data in the future. Submitting data through the prototype is completely voluntary.

What data do in scope firms need to submit to the FCA?

If the requirements come into force as proposed in the consultation paper, firms in scope will have to provide the FCA with significantly more data and information about the regulated activities they are engaged in, including:

For credit broking firms:

• If applicable, why they are not using their permission.
• Detailed information about the types of finance agreements they broker and the total number of finance agreements brokered.
• In relation to what types of goods or services- minimum/maximum/average value of the product.
• Declined and successful applications.
• Commission.
• Sales channels.

For debt firms engaged in debt counselling and/or debt adjusting:

• Information about debt adjusting and/or debt counselling activities engaged in.
• Fees and revenue.
• Debt advice solutions.
• Where applicable, funding source, client money and prudential information.

Timelines for implementation

As stated above, the FCA is proposing that the rules come into effect immediately when the Policy Statement is published in Q1 2025. However, to reduce the burden on firms, the FCA will increase the response timeframe from 20 business days to 40 business days from the end of the reporting period. The first submission will be an annual submission for all firms. For larger firms who will report every six months, their first half yearly submission will cover 1 January to 30 June 2026.