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Detail of outcome
On 10 July, the government published a response to its consultation Reform of the Consumer Credit Act (CCA). The document provides an overview of the feedback to the consultation and outlines the government’s proposed next steps. Overall, stakeholders were supportive of reforming the CCA and the government plans to move forward with an ambitious overhaul of the CCA. As a next step, the government will be undertaking policy development to produce more detailed proposals, with a view to publishing a second stage consultation in 2024 to seek comment from stakeholders.
The Consumer Credit Act 1974 (CCA) governs the regulation surrounding billions of credit card purchases, personal loans and consumer hire agreements made by UK consumers every year. It is the government’s intention that this reform will facilitate innovation in the credit sector and increase accessibility of credit products, contributing to growth in the sector and the economy more broadly. This is also an opportunity for the government to bolster existing consumer protections to ensure customers remain adequately protected in a modern and increasingly digital economy.
On 16 June 2022, the government announced its intention to reform the CCA. The consultation published today is the first stage of the reform and asks stakeholders for input on the strategic direction of reform. It also asks questions about how the consumer credit regulatory environment could be changed to ensure optimal performance of regulation surrounding customer communications, consumer protections and sanctions for firms that do not adhere to regulatory standards. Further questions cover how this reform should approach the accessibility of credit and financial inclusion. We invite input from stakeholders by 17 March 2023.