HM Treasury is consulting on proposals to reform the Consumer Credit Act (CCA) 1974.

The consultation sets out the government’s proposal to reform the CCA. Due to the scale and complexity, the work will be split into two phases. This is the consultation for Phase 1 which seeks views on the proposals in relation to information requirements, sanctions and criminal offences.

The government has identified opportunities to deliver a modernised regime which ensures consumers are provided with clear information at the right time enabling them to make informed financial decisions, as well as ensuring robust consumer protections are maintained. The consultation also aims to ensure the new consumer credit regime is proportionate and supports innovation and growth.

The CCUA is largely supportive of the modernisation of the rules around Consumer Credit requirements and expectations. However, any changes will carry a degree of risk and uncertainty. In the years leading up to and around 2010, there was argument and litigation regarding interpretation of requirements. This uncertainty and confusion was detrimental to the interests of both customers and creditors alike. Ultimately that situation was largely resolved by clear judicial decisions in cases such as Rankine and anor vs American Express Services Europe Limited and ors [2009] EWCA Civ 1539 and Carey and others vs HSBC and others [2009] EWCA 3417 (QB), but it was very unwelcome and disruptive period.

In order to avoid a similar situation again, the CCUA believes it is imperative that any requirements are completely clear and unambiguous.

Read the CCUA’s full response to the current consultation here.