pc
nid 92590
May 18, 2026
csoo@vixio.com
United Kingdom
Competition and Markets Authority
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1901 charsUnited Kingdom Government Modernises Consumer Credit Act to Enhance Consumer Protection and Support Innovation
On May 18, 2026, the United Kingdom government announced landmark reforms to the Consumer Credit Act (CCA), legislation first passed in 1974. The reforms represent the first comprehensive modernisation of the act in over 50 years and form part of the Financial Services and Markets Bill introduced in the King's Speech.
The government will transfer many of the CCA's detailed, prescriptive requirements from legislation into the Financial Conduct Authority's (FCA) rulebook, enabling the regulatory framework to adapt more readily as technology and financial products evolve. The reforms aim to provide consumers with clearer information about credit products, including credit cards, loans, and overdrafts, helping them make informed financial decisions. The new regulations will be informed by consumer testing and kept under review as products and technology change. The government emphasised that robust consumer protections will be maintained to the highest standards, with the FCA retaining a wide range of enforcement powers, including the ability to fine firms that breach the rules. Simultaneously, the reforms provide firms with greater flexibility to develop new products and leverage new technology to serve customers more effectively, rather than operating within rules designed for the pre-digital era.
Economic Secretary to the Treasury and City Minister Rachel Blake said the Consumer Credit Act was written for a different era and that the government is creating a flexible regime fit for the digital age. The government published a policy statement setting out its final approach to CCA reform alongside its response to the Phase 1 CCA reform consultation on May 18, 2026. Both documents are available on GOV.UK. The reforms are expected to benefit consumers through clearer, better-timed information while supporting vulnerable consumers who may find financial jargon challenging.
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1997 charsUK Government Publishes Policy Statement on Consumer Credit Act Reform
On May 18, 2026, the United Kingdom Government announced landmark reforms to the Consumer Credit Act (CCA) alongside its policy statement on the Act.
In 2025, the Government published its Phase 1 consultation on CCA reform which set out its approach to the overall reform of the CCA and detailed proposals in relation to information requirements, sanctions and criminal offences
This Policy Statement sets out the Government’s response to the Phase 1 consultation, its approach for the remaining CCA provisions and the changes it will take forward, including rights and protections, scope and key definitions, any consequential changes and transitional provisions. Specifically, this policy statement covers the following:
The Government's proposal to repeal many of the remaining CCA provisions and much of the associated secondary legislation; some of these provisions may fall away where they are no longer needed, and others will be recast where appropriate into the Financial Conduct Authority's (FCA) rules, subject to any consultations.
The Government’s response to the Phase 1 consultation, as well as the changes in relation to information requirements, sanctions and criminal offences.
The Government’s approach to the remaining CCA Provisions and the changes relating to rights and protections, scope, and key definitions.
The Government’s approach to transition from the current CCA provisions to the new reformed regime.
The Government intends to consult on its approach to this in Q2 of this year, which will consider whether any additional FCA powers in FSMA are required. Alongside reform of the CCA, the Government intends to review the regulatory regime for credit broking, which sits within the Regulated Activities Order (RAO).
The FCA has also published a statement to set out its approach to CCA reform (guided by its statutory objectives and wider strategy), highlighting some of the existing rights and protections that it will consider as part of its policy work.