If your business provides credit facilities to customers, there are a number of regulations you may need to comply with.
The rules don't just apply to specialist credit businesses such as credit card providers or moneylenders. A shop or mail order business that allows customers to buy on credit, or hires out or leases goods will probably have to comply with them too.
In many cases, you'll have to apply to the Office of Fair Trading (OFT) for a consumer credit licence. This also shows consumers that your business is considered fit by the OFT to provide credit.
Does my business need a consumer credit licence?
You're likely to require a consumer credit licence if your business:
- sells on credit
- hires or leases out goods for more than three months
- lends money
- issues credit cards
- arranges credit for others
- offers hire-purchase terms
- collects debts
- helps people with debt problems
- advises on people's credit standing.
However, unless your business is a credit reference agency, you're unlikely to require a licence if you:
- lend amounts of credit or hire goods at a cost, which is always more than £25,000
- only deal with limited companies
- offer no other form of credit than accepting credit cards issued by someone else
- allow customers to pay their bills in four or fewer instalments over a year.
The council's Trading Standards team can supply you with an application form or you can download them from the Office of Fair Trading website. However, the OFT deals with issuing licences and any queries should be directed to them:
Consumer Credit Licensing
Room 1C/5
Office of Fair Trading
Fleetbank House
2-6 Salisbury Square
London
EC4Y 8JX
Enquiry Line Tel: 020 7211 8608
Email: enquiries@oft.gsi.gov.uk.
Website: Office of Fair Trading Consumer credit licences.
This page is for guidance only - for more information please contact:
North Lincolnshire Council
Trading Standards
PO Box 42
Church Square House
Scunthorpe
DN15 6XQ
Tel: 01724 297664
Fax: 01724 297895
Email: trading.standards@northlincs.gov.uk.