Regulatory Alerts2017-07-27
Added · Updated
PS18/19: Assessing creditworthiness in consumer credit
Final rules and guidance in the Consumer Credit sourcebook (CONC) come into effect on 1 November 2018, requiring consumer credit lenders and peer-to-peer platforms to assess both credit risk and affordability before granting credit or significantly increasing limits. The changes clarify that firms may consider household or other income in affordability assessments, provided it is reasonably expected to be available for repayment, and define non-discretionary expenditure to include that of any other person whose income is taken into account. Firms must establish clear policies approved by senior management and maintain records of transactions to demonstrate compliance with these proportionate, principles-based requirements.
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