UK FCA regulatory priorities report on consumer finance

The UK Financial Conduct Authority (FCA) has published its regulatory priorities report for the consumer finance sector. These reports replace the FCA's previous portfolio letters and aim to provide a clearer and more consistent articulation of regulatory expectations. The FCA highlights that the credit sector is one of the UK's most varied markets, fuelling consumption and supporting economic growth. While consumer credit lending continued to grow throughout 2025 and interest rates have eased slightly, household budgets remain under pressure. This reinforces the need for responsible lending and early, effective support for consumers in financial difficulty.

The FCA sets out three priority areas for the next 12 months:

• Access to credit that meets consumers' needs: Firms are expected to lend responsibly, providing well-designed credit that offers fair value and meets consumers' needs. The FCA encourages firms to consider how to support consumers excluded from credit—whether through innovation, new product design, budgeting tools, eligibility checks for grants and benefits, or appropriate referrals.
• Supporting consumers who struggle with debt: Firms must ensure consumers can access support without unnecessary barriers. Debt advice should be clear so consumers can make timely, well-informed decisions that lead to good outcomes.
• Appropriate complaints and redress processes: Firms are expected to handle complaints appropriately, maintain adequate records, undertake root cause analysis and hold sufficient funds to meet potential and actual liabilities. Motor finance firms should be preparing for the potential redress scheme. All firms should continue to improve alignment with the consumer duty.

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