The FCA published its 2021/22 Business Plan on 15th July setting out the following cross-sectoral highlights:
- A commitment from the FCA to be more innovative
- A commitment to strengthen the authorisation gateway
- An intention to operate a hybrid authorisation/supervision model for newly authorised firms
The 2021/22 Business Plan also makes it clear that the FCA has carried over its priorities for the consumer credit market from its previous Business Plan.
In Business Plan 2021/22, the FCA acknowledges that the pandemic has caused financial difficulties for many consumers which increases the risk of consumers taking out unsustainable credit.
We recommend that retail lenders ensure that areas within its business operations that inherently carry a higher risk of consumer harm, for example;
- creditworthiness assessments
- arrears and forbearance processes
- collections policies
Firms must ensure that they systems and frameworks are sufficiently robust to provide consumer protection that is commensurate to the risks of unsustainable borrowing caused by the pandemic.