Apply to become a consumer credit lender or hirer

If you want to engage in regulated activities as a lender or hirer, you need to be authorised by us. Find out how to apply.

mainstream consumer credit lenders – providers of mainstream consumer credit products like unsecured personal loans and credit cards
high-cost lenders – including high-cost short-term credit providers, home collected credit providers, bill of sale lenders, pawnbrokers and guarantor lenders
motor finance providers – providers of finance to fund the purchase or hiring of motor vehicles, for example through a Personal Contract Purchase (PCP) or Personal Contract Hire (PCH) agreement
retail finance providers – for example, providers of credit that's used fund the purchase of retail goods or services
Limited Permission lenders – suppliers that provide finance directly so consumers can pay for goods or services by instalments
consumer hire firms – firms that rent/hire/lease goods to consumers

You'll need to demonstrate that you can consistently deliver good outcomes for retail consumers. Make sure you read everything below before you apply to ensure that your application goes smoothly.

What to read first

Our how to apply page explains:

our expectations of all firms
the application process
how to avoid delays with your application

You must read this page in full before submitting your application through our Connect system.

Along with your application form, you'll need to provide a range of supporting documentation depending on your type of firm. This includes your:

regulatory business plan
financial forecasts
required policies, procedures and other relevant forms on Connect

Check what supporting material you need to include.

Review the letters we've sent to your sector.

This includes our Dear CEO letter that focuses on how you should implement our Consumer Duty, which requires your firm to put its customers’ needs first.

Our how to apply page explains:

our expectations of all firms
the application process
how to avoid delays with your application

You must read this page in full before submitting your application through our Connect system.

Along with your application form, you'll need to provide a range of supporting documentation depending on your type of firm. This includes your:

regulatory business plan
financial forecasts
required policies, procedures and other relevant forms on Connect

Check what supporting material you need to include.

Review the letters we've sent to your sector.

This includes our Dear CEO letter that focuses on how you should implement our Consumer Duty, which requires your firm to put its customers’ needs first.

Limited or Full Permission

You'll either have to apply for Limited Permission or Full Permission, depending on the regulated activities you engage in and the circumstances in which you carry them out. You'll select one of these options when you start your application on Connect.

Limited Permission firms only carry out certain credit-related activities, so are subject to fewer threshold conditions (our minimum standards) than other firms. All other firms are Full Permission firms. Whether you're applying for Limited or Full Permission, the application process is the same.

How to determine whether you need Limited or Full Permission

Consumer credit lending is only Limited Permission if it's carried on by:

a local authority, or
a supplier, where no charge (by way of interest or otherwise) is payable by the borrower and the agreements are not hire purchase or conditional sale agreements

Consumer hire is Limited Permission. This means firms that only ever enter into consumer hire agreements and exercise, or have the right to exercise, the owners’ rights and duties under a consumer hire agreement are Limited Permission firms.

If you're already authorised to carry on non-consumer credit activities (eg you're an insurance or mortgage broker), you'll continue to be a Full Permission firm regardless of which consumer credit activities you carry on.

Common misunderstandings about Limited Permission

Remember that if none the criteria above apply to your firm, you'll be a Full Permission firm.

Here are some common scenarios in which applicants apply to be Limited Permission by mistake – if any of these points apply to you, you'll be a Full Permission firm:

you add interest or any other charges (including late payment fees or default charges) to the agreements
the credit isn’t being used to fund the supply of goods or services by you to the borrower/customer
debt administration and debt collection
debt counselling and debt adjusting when carried on as the firm's main business
providing credit references
providing credit information services that aren't connected to Limited Permission activities
operating an electronic system (peer-to-peer lending)

Prepare your application

You'll submit your application through our Connect system, so make sure you register.

Your application must include your:

application form
regulatory business plan (RBP) that explains where your firm will fit within the market and how your products and services compare to competitors
financial forecasts – learn how to prepare your firm's financial information
other forms and supporting material relevant to your type of firm

We also expect to see some specific documents that are tailored to what your firm plans to do.

For mainstream consumer credit lenders

full details of your funding for lending – including any covenants, terms or conditions that might drive poor conduct, and how you plan to make sure this doesn't happen
the types of business your firm intends to be involved in, your target market and the steps you've taken to ensure that your products/services will meet your customers’ needs
the types of lending products and their features (including loan sizes and volumes), the interest rates and other fees that will be charges, and the terms and conditions of all agreements
how you'll distribute your products (eg through a broker network, via a price comparison website, through appointed representatives, etc)

For high-cost lenders

full details of your funding for lending – including any terms or conditions that could drive poor conduct, and how you plan to make sure this doesn't happen
the types of business your firm intends to be involved in, your target market and the steps you've taken to ensure that your products/services will meet your customers’ needs
the types of lending products and their features (including loan sizes and volumes), the interest rates and other fees that will be charges, and the terms and conditions of all agreements
how you'll distribute your products (eg through a broker network, via a price comparison website, through appointed representatives, etc)

High-cost short-term credit providers
We expect to see how your firm will comply with our price cap and rules on CPAs and refinancing.

Logbook loan providers
We expect to see that features of the products are transparent and clear to consumers, as well as whether all fees and charges are explained, along with a full disclosure that the title of vehicles transfer to the firm and so it can repossess without a court order.

Home collected credit providers
We expect to see whether there are sufficient controls/oversight over collectors/agents in customers’ homes, and whether point-of-sale information including agreement and pre-contract information provide sufficient detail and are adequately explained to customers.

Pawnbrokers
We expect to see the firm’s loan-to-value ratios and whether they exceed the National Pawnbrokers Association (NPA) recommendations, details of all fees and charges, the approach to pawning multiple items, and whether the credit agreements comply with the Agreement Regulations, which include specific provisions for the content of pawn agreements.

We also expect to see how the firm keeps pawned items safe and how it obtains the true value of items, the approach to surplus when an unredeemed pledge is sold above the redemption value, and the approach to tacking financial crime.

You should confirm whether you'll be joining the NPA, and and make clear whether you intend to collect any shortfalls between the price the pledge is sold for and the loan that was granted, as this is key to determining whether our affordability rules apply or not.

Guarantor loan providers
We expect to see how the firm will ensure guarantors fully understand they will become liable for the debt if the borrower stops paying, and that point of sale information including agreement and pre-contract information is sufficiently detailed. Additionally, we expect to see details of all fees and charges, the approach to relending and the use of CPAs, as well as how the firm will calculate redress for upheld complaints.

For motor finance providers

the types of business your firm intends to be involved in (eg your target market and customer profile) and how your products/services will meet customers' needs
the types of lending products and their features (including loan sizes and volumes), the interest rates and other fees that will be charges, and the terms and conditions of all agreements
how you'll distribute your products (eg through a broker network, via a price comparison website, through appointed representatives, etc)
how you'll choose which brokers/distributors to work with and how you've considered the outcomes retail customers will achieve
if you plan to use immobilisers, how you've ensured that their use is compatible with our Consumer Duty

For retail finance providers

the types of business your firm intends to be involved in (eg your target market and customer profile)
the types of lending products and their features (including loan sizes and volumes), the interest rates and other fees that will be charges, and the terms and conditions of all agreements
how you'll distribute your products (eg through a broker network, via a price comparison website, through appointed representatives, etc)
how you'll choose which retailers/service providers to work with and how you've considered the outcomes retail customers will achieve
whether your firm plans to make use of Continuous Payment Authorities (CPAs) and, if so, how you'll use this appropriately

Credit risk, affordability, arrears and forbearance (in your supporting material)

Please pay particular attention to this section on the supporting material page.

As a lender, we expect to see policies and processes that clearly demonstrate how you'll:

assess credit risk, including how staff or systems would do this in practice and when you wouldn't lend to customer
determine a customer’s affordability – again, explain how staff or systems would do this
use data if you plan to use Office of National Statistic (ONS) data or open banking – explain which data you'll use, why you deem those data to be appropriate and how non-standard (eg self-employed) income and expenditure would be assessed
identify customers at risk of financial difficulty, and what you'll do to help them
mange customers that fall into arrears, including the options you'll offer them and how, in practice, your staff/systems will determine which option to offer in any given situation
monitor lending and arrears data so you can act to deliver consistently good outcomes to retail customers

You must answer all questions on the application honestly, including on Form As, and provide us with full information regarding any disclosures you make, including details about any removals you've had from lender or product providers’ panels.

If in doubt, let us know as much as possible, even if it may not seem relevant.

If you don't disclose something, we take this very seriously and may consider it to be evidence of dishonesty and/or lack of integrity.

Application fee

You have to pay a fee to submit your application. The fee is non-refundable.

If you're applying for:

Limited Permission your fee falls into pricing category 2, which will be £500
Full Permission your fee will be higher, and the pricing category will depend on the regulated activities you intend to carry out

Mainstream consumer credit lender

Find out more about our authorisation fees, including our pricing categories and how to pay.

Final check and submit

Before you submit everything on Connect, give it one more check to be sure you've included everything.

Our how to apply page has 3 top tips to ensure your application goes smoothly, and explains what happens after you've submitted it.

If you need more help

Please contact us on 0300 500 0597. We're open Monday, Tuesday, Wednesday and Friday 9am to 5pm, and Thursday 9.45am to 5pm.