Close Brothers Motor Finance is calling on dealers to change their attitudes towards industry regulation or face the consequences.
Dealers could face hefty fines from the FCA as well as damage to reputation and lack of consumer confidence unless they become more comfortable with regulatory requirements, according to CEO James Broadhead.
Broadhead said: “As an industry, we must make regulation less of an administrative burden and more of a positive action that protects both dealers and customers.
“Dealers must start seeing themselves as finance and insurance sellers if they are to remain competitive in the future. No dealer can afford to stop selling motor finance therefore compliance with regulation is critical.”
Since regulation of the consumer credit industry passed from the Office of Fair Trading (OFT) to the Financial Conduct Authority (FCA) last April, many dealers have had difficulty adjusting to the regulators expectations, Broadhead said.
Broadhead added: “Most of our dealers see compliance of consumer credit as a necessary evil. This needs to change. Having a thorough understanding of regulation is a positive, helping dealers to give their customers the best purchasing experience possible and ultimately helping dealers to grow their businesses.”
Close Brothers Motor Finance has been offering guidance to its network of dealers on what FCA regulation means to their business and helping them with practical support.
As part of its advice Close Brothers suggest that: firms should facilitate customers’ ability to shop around for credit; credit complaints should be logged and reported and dealt with fairly; firms should ensure they have full and clear documentation for customer transactions; firms must pay due regard to the interests of its customers and treat them fairly. Give customers all the information to make an informed decision.