Businesses who provide credit facilities to customers must comply with several regulations. The Consumer Credit Acts and regulations apply to businesses that, supply goods by mail order, allows customers to buy on credit or leases or hires goods. Most businesses must apply to the Office of Fair Trading (OFT) for a consumer credit licence before providing credit services.
Consumer Credit Licences
Trading without a consumer credit licence is a criminal offence and can result in a fine, imprisonment or both. Further information on how to apply for a licence is available from the office of Fair Trading website as follows:
Advertising
The Consumer Credit (Advertisements) Regulations 2010, control the information which is given in any advertisement for credit or hire facilities. This is to ensure that consumers are given all the necessary information to get an accurate picture of the type and cost of credit on offer.
The Regulations are enforced by local authority trading standards services and by the Office of Fair Trading using powers in Part 8 of the Enterprise Act 2002.
The advert may be in any format including print, radio, television, film/video, internet, even an approach by a salesperson may be classed as a credit advert. All credit adverts must be intelligible and legible (or clearly audible in the case of information given verbally) and specify the name of the advertiser.
Further Information
Further information about the requirements for credit adverts can be found on the Office of Fair Trading Credit Advertising webpage.
If you use credit adverts, we strongly recommend that you request the Office of Fair Trading’s credit advertising booklet which can be ordered from their website.
