In December 2025, the FCA published its updated Regulatory Initiatives Grid. We explore what’s in the pipeline for consumer credit and lending firms as we move into 2026.
- Financial promotions: We’ll see an update to the rules in CONC 3 on financial promotions. CONC 3 contains some stringent rules on promotions for credit products. The FCA has indicated that there could be a move away from these prescriptive requirements to a more outcomes-focused approach, in line with the Consumer Duty (particularly relating to the consumer understanding outcome). The FCA will be seeking stakeholder feedback in Q2 of this year.
- Motor finance commission review: The FCA will decide on its intended redress scheme. Final rules and the scheme’s launch is expected imminently.
- Extending the regulatory perimeter: Third-party BNPL lenders are being brought within the regulatory perimeter, with a new regulated activity of entering into a Deferred Payment Credit Agreement. Any BNPL firms will need to be in the Temporary Permissions Regime (TPR). The window for TPR registration opens on 15 May 2026 and closes on 1 July 2026.
- High-cost short-term credit price cap review: The FCA is looking at whether the price cap continues to protect customers, preserves market viability and avoids unintended exclusion or substitution. The FCA is keen to understand if consumer protection is hampering market access, particularly in relation to high-risk borrowers. Its findings are expected in Q3 2026.
These credit-related interventions demonstrate the FCA’s ongoing focus on credit as a high-risk, high-priority sector. We expect to see a shift towards an approach that is more aligned with the Consumer Duty, based on consumer outcomes. This reflects broader credit reform proposals that have already identified the prescriptive rules borne out of the Consumer Credit Act 1974 as being out of step with modern borrowing practices—a change that we expect will be welcomed by the industry. We’ll wait to see if the FCA can deliver on these expectations.
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If your firm needs support with any aspect of regulatory compliance, please get in touch with our Financial Services team.
