Consumer Credit License

[CitySlicker]

Hi.
We are a retailer of agricultural products and we sell 70% of our goods at the tills to customers paying with cash/cards. However we have many other customers who have 30 day credit accounts with us. We don't charge any interest or any fee for having the account, we just allow them a bit of extra time to pay. Account holders vary from limited companies to councils to private individuals.
Do we need a Consumer Credit License, whatever one of those is?
Thanks

 

[LMDServicesUK]

I believe that unless you are offering Financial Services, which in your case it would appear you are not probably do nt..

However I would have thought a call to your local Trading Standards office of your Local Authority would clarify things for you but I think you should be OK.

CCL's are normally required for businesses offering any form of Financial services or for example undertaking any form of chargeable Debt Collection work.

I would also Google the Office of Fair Trading's website as they administer CCL's if you want to be absolutely sure..

 

[promdressers]

Do we need a Consumer Credit License, whatever one of those is?
Thanks[/quote]

You may wish to look at this.:
http://oft.gov.uk/OFTwork/credit-licensing/do-you-need/who-needs/#.UvFia_l_t34

(As you are not charging interest, I believe you are not required to hold a licence)

It was definitely the case, when I had a licence, that if you were just offering extended payments, ie time to pay) then a CCL was NOT required.But there are major revisions in March, so you need to check the above link to satisfy yourself.

 

[harper101]

I believe that unless you are offering Financial Services, which in your case it would appear you are not probably do nt..

However I would have thought a call to your local Trading Standards office of your Local Authority would clarify things for you but I think you should be OK.

CCL's are normally required for businesses offering any form of Financial services or for example undertaking any form of chargeable Debt Collection work.

I would also Google the Office of Fair Trading's website as they administer CCL's if you want to be absolutely sure..

Agree with you!

Just to be sure to follow what is required/not required.

 

[businessfunding]

No you don't - as you are offering normal trade terms.

 

[ClubberLang]

The first question are - are you offering credit. The answer to that one is yes as you are giving people time to pay. The fact that it is interest free is irrelevant when deciding if it is credit or not.

The next question is does the Consuemr Credit Act apply - it applies to consumers and partnerships of up to 3 people - limited companies would not be covered by the Consumer Credit Act

Final question is - is it an exempt credit agreement? Some forms of credit lending are exempt from having to comply with consumer credit legislation (including licences)

There is a page on the OFT website abotu exempt agreements which I cannot link to and there is a PDF which lists all exempt agreements (relevant aprt below)

At the bottom - what you are offering is a debtor creditor supplier agreement (you are the creditor and supplier and customer is debtor) - as it is interest free and can be paid within 4 payments within 12 months it is exempt.

You need to make sure you offer stays within the exemption though (i.e rquire acocunt to be settle within 4 payments within 12 months with NO CHARGES)

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The Act does not regulate a debtor -creditor-supplier agreement for fixed-sum credit where the credit is provided without interest andwithout any other charges and which is:
•
an agreement under which the total number of payments to bemade by the debtor does not exceed
four, and those payments arerequired to be made within aperiod not exceeding 12 months
beginning with the date of the agreemen