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FCA credit broking survey
The UK Financial Conduct Authority (FCA) has announced that it plans to send a survey to 300 credit broking firms on 20 May 2021 asking them to update the information the FCA holds on how the firms are using their credit broking permission. The FCA will send the survey to the remaining firms holding a credit broking permission in July 2021.
The FCA states that it will use the data provided, alongside existing data, to support its ongoing work to mitigate risks of harm to consumers.
Firms will have 15 working days to submit their responses to the survey and it should take up to 30 minutes to complete.
While the FCA is not seeking this information under its formal information gathering powers, it expects firms to complete the survey. The FCA reminds firms that they are required under Principle 11 of the Principles for Businesses to deal with their regulators in an open and cooperative way. Where firms do not complete the survey, it may contact them to understand the reasons for this.
The FCA directs firms to its survey FAQs if they have any questions. Firms can also contact its Supervision Hub on 0300 500 0597 from the UK or +44 207 066 100 from abroad, or via email at firm.queries@fca.org.uk.
MCD: European Commission review report
The European Commission has published a report to the European Parliament and Council of the EU on the review of the Mortgage Credit Directive (MCD), as required under Article 44. The report covers the MCD's impact on consumer protection and its impact on the single market. The annex to the report sets out data relating to the role of credit intermediaries in mortgage lending.
The report will feed into the next phase of the review of the MCD, where the Commission will carry out an evaluation based on additional evidence gathered through a consultation and impact assessment. This will be with a view to deciding on future initiatives (legislative or not) concerning the MCD.
In line with Article 45 of the MCD, and reviewing the need to supervise credit registers, the Commission will submit a comprehensive report assessing the wider challenges of private over-indebtedness directly linked to credit activity at a later stage. This will consider the impact of the COVID-19 pandemic on consumers.
NCAs' mystery-shopping activities: EBA report
The EBA has published a report on the mystery-shopping activities of national competent authorities (NCAs). For the purposes of the report, mystery shopping is an undercover research approach used by NCAs to measure quality of customer service or to gather information about financial products and services and the conduct of financial institutions towards consumers. The report covers initiatives relating to retail banking products and services (that is, mortgages, deposits, payment accounts, payment services and electronic money).
In the report, the EBA summarises the most common approaches to mystery shopping taken by the NCAs. It reviews the objective, subject matter and product scope of these activities, the methodologies used by NCAs and follow-up actions taken by NCAs following the mystery shopping. The EBA also sets out lessons learned and good practices identified by the NCAs from the most relevant initiatives.
The EBA found that NCAs consider that mystery shopping allows them to obtain faster results and encourages financial institutions to take corrective actions where regulatory shortcomings are identified. However, some challenges remain regarding the collection of information or evidence that differs from one country to another. The good practices identified by NCAs mostly concerned common methodology aspects such as organising the training of inspection agents, identifying target customer profiles and defining agreed "rules" of consumer behaviour.
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Authored by Yvonne Clapham
