Contents:

• Consumer credit forms: FCA statement on post-Brexit changes
• LSB Standards of Lending Practice for personal customers updated
• Brokers' failure to disclose amount of commission: Court of Appeal decision

Consumer credit forms: FCA statement on post-Brexit changes

The UK Financial Conduct Authority (FCA) has published a statement and accompanying webpage relating to changes certain consumer credit firms will have to make to pre-contract consumer credit information forms from 1 June 2021. The FCA warns firms that, if the changes are not made, the credit agreement may only be enforceable against the debtor on an order of the court under the Consumer Credit Act 1974.

The changes relate to firms subject to regulations 8, 10 and 11 of the Consumer Credit (Disclosure of Information) Regulations 2010 (SI 2010/1013) (Disclosure Regulations) and the relevant rules in the FCA Handbook. From 1 June 2021 firms subject to:

• regulation 8 of the Disclosure Regulations must only use the new (post-Brexit) pre-contract credit information form; and
• regulations 10 and 11 of the Disclosure Regulations and CONC 2.7.2R(4)(a) of the FCA Handbook must only use the new pre-contract consumer credit information (overdrafts) form.

LSB Standards of Lending Practice for personal customers updated

The Lending Standards Board (LSB) has announced the publication of an updated version of its Standards of Lending Practice for personal customers. The standards outline the way registered firms are expected to deal with their customers throughout the entire product life cycle. The revised standards become effective on 1 July 2021 and recognise that customers are increasingly accessing credit and communicating with their lenders through a variety of digital channels.

Alongside changes to the existing standards, the LSB introduces a new standard on product and service design. It states that this will ensure that registered firms consider the needs of those customers who are at risk of exclusion, those who may be vulnerable or those who might at some point experience financial difficulty.

Brokers' failure to disclose amount of commission: Court of Appeal decision

In Wood v Commercial First Business Ltd [2021] EWCA Civ 471, the Court of Appeal upheld two High Court rulings that a borrower was entitled to rescind a loan agreement where the broker through whom the loan was arranged had received an undisclosed commission from the lender.