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Consumer and retail finance: Coronavirus and FCA expectations

The Financial Conduct Authority (FCA) says that it stands ready to take any steps necessary to ensure customers are protected and markets continue to function well. It has published a range of information for firms dealing with the fallout from the coronavirus crisis. See the main webpage for links to additional resources, including FCA information for firms on coronavirus (Covid-19) response. We set out below key considerations for firms in the consumer and retail finance sector.

General comments

The FCA expects firms to:

  • Take reasonable steps to ensure they are prepared to meet the challenges coronavirus could pose to customers and staff, particularly through their business continuity plans. The FCA gives the example of a firm closing a call centre requiring staff to work from other locations, including home. The firm should establish appropriate systems and controls to ensure it maintains appropriate records, including call recordings if required.
  • Provide strong support and service to customers during this period, being clear and transparent. Firms should use the flexibility in the FCA’s rules to support consumers, bearing in mind individual circumstances. The FCA says it welcomes firms taking initiatives going beyond usual business practices to support their customers – they should notify the FCA when they do this so that it can consider the impacts and offer support as appropriate.
  • Manage their financial resilience and actively manage their liquidity – firms should report to the FCA immediately if they believe they will be in difficulty. See this statement on the FCA’s expectations on financial resilience for solo-regulated firms.
  • Deal with complaints promptly. If the pandemic prevents this, firms should contact the FCA.

Senior Managers and Certification Regime (SMCR)

The FCA does not require firms to have a single senior manager responsible for their coronavirus response. They should allocate these responsibilities in the way which best enables them to manage the risks they face. The FCA recommends that the Chief Executive Officer Senior Management Function (SMF1), or most relevant member of the senior management team, be responsible for the firm’s approach to key workers. See the FCA’s statement on key workers, which sets out steps firms should take to help identify key workers in financial services.

The FCA has delayed publication of the SMCR directory of certified and assessed persons for at least a month. It was due to be published on the Financial Services Register by the end of March 2020.


Now that most workers and customers are confined to their homes, firms should check their permissions before changing delivery routes to market and get in touch with the FCA in case other permissions are required. In its recent statement on work-related travel and the responsibilities of Senior Managers, the FCA said that those selling non-essential goods and credit would not be expected to go into work or meet face-to-face.

Mortgages and repossessions

The FCA has issued guidance to mortgage lenders, mortgage administrators, home purchase providers and home purchase administrators on how it expects them to treat customers fairly.

Where a customer is experiencing or reasonably expects to experience payment difficulties as a result of circumstances relating to coronavirus, and wishes to receive a payment holiday, a firm should grant a customer a payment holiday for three monthly payments, unless it can demonstrate it is reasonable and in the customer’s best interest to do otherwise. The guidance will be reviewed in the next three months and amended guidance extending the payment holiday period will be issued if appropriate.

Firms should not commence or continue repossession proceedings against customers at this time. This applies irrespective of the stage that repossession proceedings have reached and to any step taken in pursuit of repossession. Where a possession order has already been obtained, firms should refrain from enforcing it.

Firms should read the guidance carefully and ensure that they comply with the information requirements in their dealings with customers.

Persistent credit card debt

The FCA wants firms to show greater flexibility to customers in persistent credit card debt. Under the rules, after 36 months of someone being in persistent debt the provider must offer options to help repay the debt more quickly. If customers do not respond within a period set by the firm the card must be suspended. The FCA thinks that customers should be given more time, until 1 October 2020, to respond to firms’ communications. It will be in touch with firms shortly to confirm details.

Access to cash

Firms should continue to help vulnerable consumers access their banking services – online or over the phone. They should remind consumers to be aware of fraud and protect their personal data.

Call recordings

Firms that are required to record calls should continue to do so. Where this is not possible, they should let the FCA know. The FCA expects firms to consider what steps they could take to mitigate outstanding risks if they are unable to comply.

Submission of regulatory data

The FCA expects firms to maintain appropriate records and to submit regulatory data as soon as possible, without unnecessary delay. The FCA should be contacted as soon as possible with any concerns.

Financial reporting

On 26 March 2020, the FCA, Financial Reporting Council and Prudential Regulation Authority issued a joint statement and announced a series of actions “to ensure information continues to flow to investors and support the continued functioning of the UK’s capital markets”. They include allowing listed companies which need the extra time to complete their audited financial statements an additional two months in which to publish them.

Ongoing FCA consultations/calls for input

The FCA is extending the closing date for responses to its open consultation papers and calls for input until 1 October 2020. Most other planned work is being rescheduled and routine business interactions with firms are being scaled back.


If you need assistance with any of the issues raised in this briefing, please do not hesitate to contact Jeanette Burgess or any member of the Regulatory and Compliance Team, who will be very happy to help.