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‘Gambling’ dealers face consumer credit clampdown

Consumer credit in the automotive sector is coming under scrutiny and the authorities have started clamping down on dealers who don’t comply with the regulations. Fortunately, there are companies that can assist dealers with their legal obligations, and the Knowledge Shop at Expo (15-17 January, Stoneleigh Park, Warwickshire) is the place to find out how.

Consumer credit continues to play a key role in supporting sales in the motorcycle market, especially since the introduction of PCP. In April 2014, the Financial Conduct Authority (FCA) became responsible for the regulation of consumer credit and has since authorised more than 30,000 consumer credit firms and intervened within the payday loan and debt management sectors. This resulted in the closure of many firms whose business models didn’t satisfy FCA requirements and repayment of millions of pounds to customers.

Until now, the FCA has been busy with authorisation and regulation in higher risk areas but the regulatory spotlight is turning to the automotive sector. The FCA has already started withdrawing permissions so if you are selling finance but not managing your compliance properly, you are taking a gamble.

The advice from the Knowledge Shop is to get your compliance monitoring programme in place now to avoid the risk of legitimate customer claims and the FCA looking negatively at the way you have operated your business in the preceding years, which could cost you dearly in terms of both profits and customer retention.

* Motorcycle Trade Expo, 15, 16, 17 January. Head to the Knowledge Shop, where the Product Partnership’s team will be on hand to address any queries. All advice at the Knowledge Shop, which covers the whole industry, is free.

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