Consumer credit rates and thresholds reference

Section 75 connected lender liability

Section 75 connected lender liability (CCA 1974)

Joint and several liability of creditor and supplier under s.75 of the Consumer Credit Act 1974 for breach of contract or misrepresentation, including the GBP 100 to GBP 30,000 threshold, qualifying agreement types, and the distinction from chargeback.

Under section 75 of the Consumer Credit Act 1974, if a consumer uses a debtor-creditor-supplier agreement (such as a credit card) to purchase goods or services and the supplier breaches the contract or makes a misrepresentation, the creditor is jointly and severally liable with the supplier. This is a powerful statutory right that allows the consumer to claim against the credit provider even if the supplier has ceased trading.

Single item value - lower threshold: GBP 100 minimum (the cash price of the single item or service must exceed GBP 100)
Single item value - upper threshold: GBP 30,000 maximum (the cash price of the single item or service must not exceed GBP 30,000)
Claim amount: The consumer can claim the full amount of the loss, even if only a deposit was paid by credit card. The GBP 100-30,000 thresholds relate to the item price, not the amount paid on credit.
Qualifying agreements: Applies only to debtor-creditor-supplier agreements under s.12(b) or s.12(c) of the CCA 1974, meaning there must be a pre-existing arrangement between the creditor and supplier
Credit cards: Section 75 applies to credit card purchases (including those made overseas) but does not apply to cash withdrawals, balance transfers, or money transfers
Does NOT apply to: Buy Now Pay Later, charge cards, debit cards, procurement cards, or debtor-creditor agreements (such as personal loans with no supplier link)
Chargeback distinction: Chargeback is a voluntary card scheme dispute process (Visa, Mastercard) with no statutory basis, no financial thresholds, and typically a 120-day time limit. Section 75 is a statutory right with no time limit beyond the Limitation Act 1980 (6 years in England and Wales).
Creditor's right of indemnity (s.75(2)): The creditor has a statutory right to be indemnified by the supplier for losses arising from s.75 claims

Consumer Credit Act 1974 - Liability of creditor (s.75)

Section 75 minimum single item value

GBP 100

Section 75 maximum single item value

GBP 30,000

Applies to

Debtor-creditor-supplier agreements only (e.g. credit cards, store cards)

Does not apply to

Deferred Payment Credit (BNPL), debit cards, charge cards, direct debits

High-cost short-term credit (HCSTC) price cap

High-cost short-term credit (HCSTC) requirements

Additional FCA requirements for high-cost short-term credit providers (payday lenders).

Daily interest cap: 0.8% per day maximum
Default fee cap: £15 maximum
Total cost cap: 100% of original loan amount (including all fees and interest)
Consumer savings: £150 million annually for 760,000 borrowers
Rollover restrictions: Maximum of 2 rollovers permitted
Risk warning requirement: Prominent warning about high cost nature of borrowing

HCSTC price cap rules

Maximum daily interest rate

0.8% of the amount borrowed

Maximum default fee

GBP 15

Total cost cap

100% of the amount borrowed (borrower never repays more than double)

HCSTC definition

APR of 100% or more, designed to be substantially repaid within 12 months

FCA fees

FCA consumer credit authorisation fees

Application fees and ongoing costs for FCA consumer credit authorisation.

CFO application fee: £280 (credit-related only)
Complex permissions fee: Up to £11,150
Annual periodic fees: Based on income from regulated activities - increased 2.3% for 2026/27
Variation fee: £250-£2,500 depending on complexity
RegData submission: Annual regulatory reporting required

FCA fees calculator

Limited permission application fee

GBP 280

Full permission application fee

GBP 1,500 to GBP 11,150 (depending on activity)

Annual periodic fees

Based on income from regulated activities (minimum fee band applies)

Variation of permission fee

GBP 250 (limited to full) or as per fee schedule

Financial Ombudsman Service

Financial Ombudsman Service consumer credit jurisdiction

FOS jurisdiction, award limits, case fees, time limits, and complaint handling requirements for consumer credit firms.

The Financial Ombudsman Service (FOS) has jurisdiction over complaints about consumer credit activities carried out by FCA-authorised firms. Before a complaint can be referred to FOS, the firm must first have the opportunity to resolve it through its own internal complaints handling procedure under FCA DISP rules. If the firm fails to resolve the complaint within 8 weeks, or issues a final response rejecting it, the customer may refer the matter to FOS.

Who can complain to FOS: Consumers, micro-enterprises (fewer than 10 employees and turnover or balance sheet under EUR 2 million), small charities (annual income under GBP 6.5 million), and guarantors
Maximum award limit: GBP 430,000 for complaints about acts or omissions on or after 1 April 2024 (increased from GBP 415,000)
Case fees for firms: GBP 750 per case from the 26th case onwards in each financial year; the first 25 cases per year are free
Internal complaints deadline: Firms must issue a final response within 8 weeks of receiving the complaint
Final response letter: Must inform the complainant of their right to refer the complaint to FOS within 6 months of the date of the final response
FOS referral time limit: 6 years from the event complained about, or 3 years from when the complainant became aware (or ought reasonably to have become aware) that they had cause to complain, whichever is later
Common credit complaint categories: Unaffordable lending, mis-sold payment protection insurance (PPI), hire purchase disputes, debt collection conduct, unfair charges, and commission non-disclosure
Binding decisions: If the complainant accepts the FOS decision, it is binding on the firm; if the complainant rejects it, they retain the right to take court action
FCA DISP rules: FCA Dispute Resolution sourcebook (DISP) sets out requirements for complaints handling procedures, record keeping, and reporting

Financial Ombudsman Service for businesses

Maximum FOS award

GBP 430,000 (for complaints about acts or omissions on or after 1 April 2024)

Case fee

GBP 750 per case (from the 26th case in each financial year)

Free cases per year

25 per firm

Complaints deadline

Final response within 8 weeks or refer customer to FOS

Consumer referral deadline

6 months from date of final response

Persistent debt (credit cards)

Persistent debt rules for credit cards

FCA rules under CONC 6.7.27-6.7.39 requiring firms to identify and intervene where credit card customers are in persistent debt, paying more in interest and charges than they repay in principal over 18 months.

The FCA's persistent debt rules (CONC 6.7.27-6.7.39, in force from 1 March 2018 via PS18/4) require credit card firms to take action when customers are in persistent debt. A customer is in persistent debt if, over the preceding 18-month period, they have paid more in interest, fees, and charges than they have repaid of the principal balance.

These rules form a two-stage intervention framework: a notification at 18 months and a mandatory intervention at 36 months. The rules aim to reduce the harm caused by customers making minimum payments indefinitely on revolving credit products.

Persistent debt definition: Customer has paid more in interest, fees, and charges than in principal repayment over 18 months (CONC 6.7.27R)
18-month notification: Firm must contact customer to explain they are in persistent debt, encourage them to pay more, and signpost free debt advice (CONC 6.7.28R)
36-month intervention: If customer remains in persistent debt after a further 18 months, firm must offer ways to repay the balance faster over a reasonable period (CONC 6.7.33R)
Options at 36 months: Firm must propose reasonable ways to increase repayments, which may include reducing the interest rate, suspending interest, or setting up a structured repayment plan (CONC 6.7.34R)
Customer non-response at 36 months: If the customer does not respond to the 36-month intervention or does not agree a plan, the firm must take steps to reduce the outstanding balance, which may include suspending or cancelling the card (CONC 6.7.37R)
Suspension of card use: Firm may suspend or cancel the credit card if the customer does not engage after 36 months of persistent debt (CONC 6.7.38R)
Forbearance obligation: Firms must exercise forbearance before suspending; they must not suspend if they are aware the customer is in financial difficulty and is engaging with debt advice
Rules effective from: 1 March 2018 (FCA PS18/4)

FCA CONC 6.7 - Post contract obligations (credit cards)

Persistent debt definition

Over 18 months, customer has paid more in interest, fees and charges than they have repaid of the principal

18-month notification

Inform customer they are in persistent debt, explain consequences, suggest ways to repay faster

36-month intervention

If still in persistent debt, offer options to repay faster; may need to suspend the card, reduce credit limit, or cancel the card if customer does not respond

FCA source

CONC 6.7.27 to 6.7.39

Early settlement compensation

Maximum compensation (remaining term over 12 months)

1% of the amount repaid early

Maximum compensation (remaining term 12 months or less)

0.5% of the amount repaid early

De minimis threshold

No compensation if interest saved is GBP 8 or less

Settlement statement deadline

7 working days from customer request

Statutory basis

Sections 94 to 97 CCA 1974; Consumer Credit (Early Settlement) Regulations 2004

Exempt agreement thresholds

Exempt agreement threshold (high net worth)

GBP 60,260 (annual income)

Credit agreement over GBP 60,260 plus business declaration

May be exempt from CCA 1974 regulation

Exempt interest-free credit

No interest, no charges, repayable in 12 or fewer instalments within 12 months

Note

The exempt interest-free credit exemption is being removed for BNPL/DPC from 15 July 2026

Related guidance

For detailed guidance on how to apply these thresholds:

FCA consumer credit authorisation - permissions and application
Hire purchase and conditional sale - HP-specific rules
Credit broking compliance - broker fee rules
BNPL regulation - DPC thresholds and exemptions
Compliance checklist - annual verification

Official sources

FCA Consumer Credit sourcebook (CONC) (opens in a new tab)
FCA rules including HCSTC price cap, persistent debt, and financial promotions.
fca.org.uk
FCA: Fee calculator (opens in a new tab)
Calculate your FCA periodic fee.
fca.org.uk
Financial Ombudsman Service: complaint limits and fees (opens in a new tab)
Current FOS award limits and case fee structure.
financial-ombudsman.org.uk
Consumer Credit Act 1974 (legislation.gov.uk) (opens in a new tab)
Primary legislation including Section 75, early settlement, protected goods.
legislation
Consumer Credit (Early Settlement) Regulations 2004 (opens in a new tab)
Early settlement compensation calculation.
legislation

Consumer credit rates and thresholds reference

Comply with high-cost short-term credit rules

FCA consumer credit authorisation

Handle consumer credit complaints and the Financial Ombudsman

Consumer credit compliance checklist

Section 75 claims and connected lender liability

Section 75 connected lender liability

High-cost short-term credit (HCSTC) price cap

FCA fees

Financial Ombudsman Service

Persistent debt (credit cards)

Early settlement compensation

Exempt agreement thresholds

Related guidance

Official sources

Related guides in Financial Regulation Overview

Comply with high-cost short-term credit rules

FCA consumer credit authorisation

Handle consumer credit complaints and the Financial Ombudsman

Consumer credit compliance checklist

Section 75 claims and connected lender liability

Section 75 connected lender liability

High-cost short-term credit (HCSTC) price cap

FCA fees

Financial Ombudsman Service

Persistent debt (credit cards)

Early settlement compensation

Exempt agreement thresholds

Related guidance

Official sources