Financial Promotions Guide
2.5 // Regulatory disclosures
Financial Promotions Guide
2.5 // Regulatory disclosures
Status disclosure:
In any of your financial promotions or communications with customers, you must:
- Specify your legal name as it appears in the Financial Services Register. You can include a trading name, but the legal name must accompany it.
- Make it clear that you are a credit broker and not a lender.
- Include your FCA-regulated status.
- Use the formulation “Financial Conduct Authority”; you cannot abbreviate to “FCA”.
You can add words to the disclosure, provided it is clear, fair and not misleading.
- If you are an authorised firm, the wording that should be used is “(legal name) is authorised and regulated by the Financial Conduct Authority”.
- If you are an appointed representative, the wording should be “(name of authorised representative) is an appointed representative of (principal firm name) which is authorised and regulated by the Financial Conduct Authority.”
You can see two different disclosure examples below.
Eligibility criteria:
You need to make the following clear within your financial promotions:
- Finance is subject to application and status – you can’t state or imply that credit available regardless of the customer’s financial circumstances or status.
- Who is eligible to apply for finance, and any restrictions on who can make an application, for example ‘Terms and Conditions apply, over 18’s only.'
Commission disclosure
In financial promotions and other communications with customers, you should include details on the nature of all your commission arrangements and if they impact your impartiality in recommending a product to a customer, which in turn may affect the customer’s willingness to transact.
- Websites, marketing, emails etc must be considered.
- Are there any limitations in your funder panel? Are you working exclusively with one or more lenders or are you independent?
- The types of rates you can offer customers and the ability to explain how these are set.
- What, if any, parameters could change the rate the customer is offered? (For example: credit score, age of vehicle, loan amount).
- Are there different product features that need to be explained?
- How independent are you?
- Do you charge any fees for arranging the finance? If you do charge a fee, is this because you believe you give advice? Please note: Evolution Funding will not support this practice and you should discuss this with your account manager.
- Explaining the commission arrangements involved – you do not have to disclose the amount, but you may wish to signpost the customer to where they can get that information.
- What types of commission do you receive? This can be in broad terms.
- Explaining how the commission can differ between credit provider, product, and other factors (e.g., amount of the loan, term etc.). If the customer is eligible for two or more products and your commission varies, you need to disclose this.
- The existence and nature of any financial arrangement with a lender should be shown prominently. This is really important and applies when you promote or recommend a credit product. You will need to adapt your existing disclosure statements and ensure that in all financial promotions and customer communications the nature of the commission is included, along with a description of the models you are permitted to use. These disclosures may be in general terms.
- If you are a franchised retailer who has an arrangement with a captive lender you may choose to mention them by name - e.g. “We can introduce you to a selected panel of lenders, which includes ABC Finance”. You can explain your process to introduce customers to that lender first, as well as any specific differences in your commission arrangements with the captive lender.
- If you receive any other types of support, such as unit stocking, marketing, or training from a lender that may influence your decision when placing business, you may also choose to include these details.
Example disclosures
<Dealer trading name> is a trading style of <dealer legal name>. <Dealer legal name> are authorised and regulated by the Financial Conduct Authority. FCA number <FCA number>. We are a credit broker and not a lender. Finance subject to status. Terms and conditions apply. A guarantee may be required. Over 18s only.
PLEASE ENSURE YOU CAN AFFORD THE REPAYMENTS FOR THE DURATION OF A LOAN BEFORE ENTERING INTO A CREDIT AGREEMENT.
We can introduce you to a limited number of lenders and their finance products which may have different interest rates and charges. We are not an independent financial advisor. We may advise you on the products, subject to your personal circumstances, though you are not obliged to take our advice or recommendation.
We do not charge you a fee for our services. Whichever lender we introduce you to, we will typically receive a commission from them (either a fixed fee or a fixed percentage of the amount you borrow).
The lenders we work with could pay commission at different rates. However, the amount of commission that we receive from a lender does not have an effect on the amount that you pay to that lender under your credit agreement.
<Dealer trading name> is a trading style of <dealer legal name>. <Dealer legal name> are authorised and regulated by the Financial Conduct Authority. FCA number <FCA number>. We are a credit broker and not a lender. Finance subject to status. Terms and conditions apply. A guarantee may be required. Over 18s only.
PLEASE ENSURE YOU CAN AFFORD THE REPAYMENTS FOR THE DURATION OF A LOAN BEFORE ENTERING INTO A CREDIT AGREEMENT.
We can introduce you to a limited number of lenders and their finance products which may have different interest rates and charges. We are not an independent financial advisor. We will provide details of products available from the lenders we work with, but no advice or recommendation will be made. You must decide whether the finance product is right for you.
We do not charge you a fee for our services. Whichever lender we introduce you to, we will typically receive a commission from them (either a fixed fee or a fixed percentage of the amount you borrow).
The lenders we work with could pay commission at different rates. However, the amount of commission we receive from a lender does not have an effect on the amount you pay to that lender under your credit agreement.
Contact address on financial promotions
You must include your name and postal address unless:
- It is made via television or radio broadcast;
- Where the promotion is a point of sale item displayed on the retailer’s premises which aren’t intended for customers to take away, e.g. showroom banners or posters;
- The promotion includes the name and postal address of a credit broker.