If you’re in the process of looking for a car finance company so you can buy a car on finance, the first crucial step to take is to check whether the lender is registered and authorised by the Financial Conduct Authority. A quick search on the FCA register will tell you whether the lender is supervised by the FCA or not. If the financing company has been operating scams, you will also see their record on the register. Be sure to check the lender through the FCA register first before using their services. And read on to find out more about this car finance jargon term, as we simplify it with everything you need to know.
Why Check with the FCA?
The Financial Conduct Authority or FCA is an important independent body in the UK regulating companies, firms, and other businesses that offer financial services in the country. The goal and purpose of the FCA are to maintain the integrity of the UK financial industry, protect consumers who seek the services of finance companies, and also promote healthy competition among various financial institutions.
What is the FCA?
Back in 2013, the UK government created the Financial Conduct Authority as a way to better regulate the financial services available in the country while also ensuring that consumers are protected and treated fairly. The aim of the FCA is to ensure that the financial markets in the UK are working well, the companies, firms, and other financial institutions are honest with the services they offer, and that consumers get a good and fair deal with them.
The FCA has the authority and power to govern the UK financial services industry. This being said, the FCA can investigate and act if and when businesses or individuals break the rules. It can force financial institutions to improve their products if the FCA finds that such products as credit cards, investments, or pensions, do not meet the required minimum standards. Banks are also under the supervision of the FCA, ensuring that they treat their customers fairly and that they are not led to take any unacceptable risks.
FCA Authorised: What Does It Mean?
All financial institutions in the UK, including consumer credit companies and investment firms, need to register their businesses to the Financial Conduct Authority before they are given permission to provide their services. However, before a finance company can be given authorisation by the FCA, it first has to meet the required standards.
When a finance firm has been authorised, the FCA can conduct an investigation in the event that the company is suspected of not meeting the standards. The FCA can then order the firm, if proven guilty, to stop doing business and also prosecute them and demand compensation for the affected consumers.
How to Use the FCA Register
If you want to check whether a finance company is FCA-regulated and authorised, you may use the FCA register. Any firm that has been registered under the FCA will have a record on the register. You may use the register to know more about the firm such as the contact details. It’s also a way to know more about what a specific finance company is authorised to do. You can also check if such business is covered by the Financial Services Compensation Scheme and the Financial Ombudsman Service.
The FCA register can also provide you with a list of the finance companies that are not authorised. It’s a good way to check if a business has been operating financing scams and avoid being a victim of their schemes. Unauthorised and illegal finance companies are marked on the FCA register with a warning symbol and red text.
If you’re unsure about a financing firm, you may want to check their record on the FCA register first before you do business with them. Knowing that the company is FCA-regulated and authorised will give you peace of mind because you are assured that the financing firm abides by the strict rules of the FCA and that you are protected as a consumer.
Be aware though that not all firms that operate scams will appear on the FCA register. It’s possible that the FCA is not yet aware of such companies. To be safe, only do business with companies that are registered with the FCA. If they are not yet on the FCA register, you may want to be more cautious and avoid getting their financing services altogether.
How am I Protected as a Consumer?
The purpose of the Financial Conduct Authority is to protect consumers from greedy companies that rip off their clients. Financial institutions under the FCA need to value the safety of their customers first and not only think about their profit. The FCA ensures that consumers of financing firms are treated fairly and are provided with the appropriate services and financial products.
The FCA checks all financial institutions first before they give them the authorisation to conduct their businesses. Once they are authorised, the FCA does not stop there because it continues to supervise the financing firms as they are operating.
Whenever the FCA suspects that certain companies or individuals are breaking the rules, it has the power to intervene and stop them from doing business. The FCA can also impose penalties and demand compensation for the consumers who have been affected by their unfair trading practices.
The FCA looks out for consumers like you who are looking to get fair financial services from lenders in the UK. Whenever you are in doubt about a certain financing company, do check them with the FCA register so you’ll know if they are authorised to operate or if they have any record of illegal activities like financing scams. If you have been a victim of one, you may get in touch with the FCA so they can help you and also alert other consumers about such companies.
As a consumer, it’s important to be careful in choosing financing companies. Remember that if an offer is too good to be true, the best next step is to walk away. It is your responsibility as a consumer to protect yourself from companies that run scams and want to take advantage of people. A quick check on the FCA register can help you avoid these illegal companies. 👍