Clause 28 - Applications for standard licences
Consumer Credit Bill
10:15 am
Gerry Sutcliffe (Parliamentary Under-Secretary (Employment Relations and Consumer Affairs), Department of Trade and Industry; Bradford South, Labour)
The clause gives the OFT the power to manage the application process more efficiently. It requires people to specify what businesses they want the licence to cover in the application for licences. That means that the OFT will be more easily able to identify and scrutinise higher risk sectors and monitor them more closely while reducing the burden on low risk sectors.
The clause will also enable the OFT to specify sub-categories, which is what is meant in the clause by “descriptions of business”. The clause also divides up the current licence categories of consumer credit, consumer hire, and ancillary credit business. Applicants can apply for a whole category licence, or one or more sub-categories. A whole category licence might cover consumer credit businesses. Within that, a sub-category licence might cover issuing secured loans of up to £10,000. The type of licence depends on the range of activity that the applicant is planning to carry out.
Licensees will be required to demonstrate fitness only for the sub-categories for which they have applied, rather than whole categories as now. Someone who undertakes only a very limited type of credit activity will in future only have to apply and be assessed for fitness within that limited category.