Last amended by Transfer of FCA regulation in 2014. Consumer credit regulation transferred from the OFT to the FCA in April 2014.
Independent editorial summary — not the official statute text. Read the official version on legislation.gov.uk.
Summary
The Consumer Credit Act 1974 regulates consumer credit and consumer hire agreements. It imposes requirements on the form and content of credit agreements, provides cancellation and early settlement rights, and establishes the connected lender liability principle in section 75 (making credit card companies jointly liable with suppliers for misrepresentation and breach of contract for purchases between £100 and £30,000).
Key Points
- Regulates consumer credit agreements and consumer hire agreements
- Requirements for proper execution of regulated agreements (ss.60–65)
- s.75: credit card company jointly liable with supplier for breaches on purchases £100–£30,000
- Right of withdrawal and cancellation (ss.66A, 67–73)
- Right to early settlement and rebate of charges (ss.94–97A)
- Unfair relationships test: court can reopen credit agreements that are unfair (ss.140A–140D)
- Licensing requirements for credit providers (now FCA authorisation)
- Unfair relationship test (s.140A-C)
- Right to withdraw from credit agreements
- Connected lender liability (s.75)
Parts & Sections
Amendments History
2006 — Consumer Credit Act 2006
Introduced the unfair relationships test (ss.140A–140D), replacing the extortionate credit bargain provisions.
2014 — Transfer of FCA regulation
Consumer credit regulation transferred from the OFT to the FCA in April 2014.
2006 — Consumer Credit Act 2006
Replaced extortionate credit bargain provisions with unfair relationship test.
Frequently asked questions
- What does the Consumer Credit Act 1974 regulate?
- The Consumer Credit Act 1974 regulates consumer credit and consumer hire agreements. It sets requirements for the form and content of these agreements, provides rights for cancellation and early settlement, and establishes the connected lender liability principle. It also includes an unfair relationships test that allows courts to reopen credit agreements deemed unfair to the debtor.
- What is connected lender liability under section 75?
- Under section 75 of the Act, credit card companies are jointly liable with suppliers for misrepresentation and breach of contract. This applies to purchases made between £100 and £30,000. If a supplier fails to meet their obligations, the debtor can take action against the credit card company instead.
- What are the requirements for a credit agreement to be properly executed?
- A regulated agreement is not considered properly executed unless the document is signed by the debtor and contains all prescribed terms. The Secretary of State may also make regulations about the form and content of these agreements to ensure debtors are fully aware of their rights and duties.
- What is the unfair relationships test?
- The unfair relationships test, introduced by the Consumer Credit Act 2006, allows a court to make an order if it determines that the relationship between a creditor and a debtor is unfair. This test replaced the previous provisions regarding extortionate credit bargains.
- Who regulates consumer credit in the UK now?
- Regulation of consumer credit was transferred from the Office of Fair Trading (OFT) to the Financial Conduct Authority (FCA) in April 2014. While the Act originally mentioned licensing requirements for credit providers, these are now handled through FCA authorisation.