The Financial Conduct Authority (FCA) has recently published the findings of its review into financial promotion approvers, highlighting areas where standards must improve. While the review focused on authorised firms that approve financial promotions for unauthorised businesses, the findings carry important lessons for consumer credit Appointed Representatives (ARs) who rely on compliant marketing to engage customers.
The FCA reviewed 10 authorised firms operating under the Section 21 financial promotion approval regime and found a mixed picture. Encouragingly, the strongest firms demonstrated a clear commitment to Consumer Duty principles, ensuring promotions were accurate, clear, fair and targeted at the appropriate audience. However, the regulator also identified significant failings, including the approval of advertisements containing unsubstantiated claims and instances where promotions intended for professional clients were accessible to retail consumers.
For consumer credit ARs, these findings reinforce the importance of taking ownership of promotional compliance, even where approvals are provided by a principal firm or external approver. The FCA’s message is clear: financial promotions must not be treated as a box-ticking exercise. Firms should be able to evidence robust due diligence, challenge marketing claims and ensure communications align with the needs, characteristics and objectives of the target market.
This is particularly relevant in the consumer credit sector, where customers may be financially vulnerable or making significant borrowing decisions. Promotions that exaggerate benefits, downplay risks or fail to provide balanced information could lead to poor customer outcomes and attract regulatory scrutiny.
The review also highlights the FCA’s continued focus on Consumer Duty. Firms identified as examples of good practice were those that embedded Consumer Duty considerations throughout their approval processes rather than viewing compliance as a final-stage sign-off. This proactive approach is becoming increasingly important across all regulated sectors.
Consumer credit ARs should use the FCA’s findings as an opportunity to review their own marketing governance arrangements and the support their principal firm provides them.
With the FCA already requiring remediation from one firm and restricting access to certain promotions, regulatory expectations are clearly rising. Consumer credit ARs that prioritise clear, fair and not misleading communications will be best placed to meet those expectations and maintain customer trust.
