Future-Proof Lenders: Navigating the New Credit Act

What’snext for lenders as the Consumer Credit Act gets a shake-up?

The government’s announcement thatthe Consumer Credit Act will be modernised for the first time in more than 50 years marks a significant milestone for the consumer credit market. First introduced in 1974, the Act has been updated over time, but many of its core rules were written long before digital banking, instant credit decisions, onlineapplicationsand embedded finance became part of everyday life.

For lenders, banks and businesses offering finance, that should be a welcome direction of travel, but it also changes the conversation around compliance. A more flexible frameworkdoesn’tmean a softerone. Instead, firms are likely to face greater focus on whether their products are fair, their communications are clear and their customers understand the cost,risksand consequences of borrowing.

After more than 50 years, reform of the Consumer Credit Act is long overdue. The way people borrow, co...