Since writing my last piece for this magazine the sales teams within First Response Finance have been working with car dealers nationwide to offer advice and assistance in relation to the regulatory changes which are coming our way.
We have been focusing on the movement in regulation for consumer credit licensing from the OFT (Office of Fair Trading) to the Financial Conduct Authority (FCA) from April 1 2014, and what impact this has on car dealers and their ability to continue carrying out regulated consumer credit activities after this date.
Back on July 15, the OFT and FCA wrote letters to existing consumer credit licence holders to advise of the changes which are taking place and asking people to ‘act now’ to ensure that the activities listed on their licence are correct, along with their name, address and company information.
The consequences of these details not being correct are that the licence holder risks operating illegally.
Upon contacting car dealers there has been an element of confusion (rest assured we felt the same way when we first became aware of these changes!) about which government body is which, what categories car dealers require, how they go about making amendments to their licence and, once this is completed, what they have to do next.
Some car dealers have put the letters they have received on the ‘to do’ pile as the complexity of what they are faced with can wait for another day or possibly they do not seem to realise the importance (which I fully understand and appreciate) of what they have to do. Others have gone into the OFT website and clicked on the consumer credit licensing section, selected the ‘change details’ option and then completed the variation application or notification form (depending on what they needed to change).
Once the licence has been updated, or for those whose licence was correct anyway, car dealers can then register with the FCA for ‘interim permissions’ which will enable them to carry on supplying consumer credit to their customers after March 2014.
What has worried us slightly so far, is the lack of activity from some car dealers, where we believe they should be moving now to change some of the details on their consumer credit licence by contacting the OFT, before they even consider the next stage. We will continue to support car dealers nationwide as First Response Finance appreciates that this can be confusing, and sometimes it’s nice to be able to ask somebody questions if you are unsure of what action is best to take.
The worst thing you can do; particularly if you want to continue offering finance within your dealership post March 2014, is nothing!
If you are stuck or want somebody to talk to then please contact us and we will be happy to offer any advice or assistance.