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<p>The independent Financial Conduct Authority (FCA) is responsible for the regulation
of debt collection activity. Where debt collection firms take steps to recover debts
that have arisen under consumer credit agreements, they are required to do so according
to the FCA’s principles, rules and guidance.</p><p> </p><p>In particular, firms are
required to treat customers fairly and to have policies in place for the fair and
appropriate treatment of vulnerable customers. Additional requirements apply in relation
to the recovery of debt from customers with mental capacity limitations.</p><p> </p><p>The
FCA has published guidance for firms on the fair treatment of vulnerable customers.
In 2023-24, the FCA plans to evaluate the action firms have taken and whether we see
improvements in the outcomes experienced by vulnerable consumers. The guidance can
be found in the link below:</p><p> </p><p><a href="https://gbr01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.fca.org.uk%2Fpublications%2Ffinalised-guidance%2Fguidance-firms-fair-treatment-vulnerable-customers&data=05%7C01%7Crajesh.kapoor%40hmtreasury.gov.uk%7Cb860737e8fba4436348108db40fd10d3%7Ced1644c505e049e6bc39fcf7ac51c18c%7C0%7C0%7C638175228146403015%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&sdata=8Kx5gz%2BRHm0bzF5xgLrDbFEYkAiYIFii%2BVYTyAC7MP4%3D&reserved=0"
target="_blank">https://www.fca.org.uk/publications/finalised-guidance/guidance-firms-fair-treatment-vulnerable-customers</a></p><p>
</p><p>In addition, earlier this year the FCA wrote to all firms operating in this
sector to set out their expectations of how firms should provide a higher standard
of care to customers in the context of the Consumer Duty. The letter can be found
in the link below:</p><p> </p><p><a href="https://gbr01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.fca.org.uk%2Fpublication%2Fcorrespondence%2Fconsumer-duty-portfolio-letter-dpca.pdf&data=05%7C01%7Crajesh.kapoor%40hmtreasury.gov.uk%7Cb860737e8fba4436348108db40fd10d3%7Ced1644c505e049e6bc39fcf7ac51c18c%7C0%7C0%7C638175228146559233%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&sdata=Ru4KlKrKIx5fUwOi6lBHsrnc7tvPGjdhs5kjBm5sq%2B0%3D&reserved=0"
target="_blank">https://www.fca.org.uk/publication/correspondence/consumer-duty-portfolio-letter-dpca.pdf</a></p><p>
</p><p>The Consumer Duty builds on the FCA’s guidance on the fair treatment of vulnerable
customers – that sets out what firms should do to ensure that customers in vulnerable
circumstances experience outcomes as good as those for other customers. Falling below
the standard set out in that guidance is likely to be a breach of the Consumer Duty.</p><p>
</p><p>There are no plans either by the Government or the FCA to review legislation
or existing FCA requirements in this area. But the FCA will continue to monitor the
activities of debt collection firms, including the steps they have taken to ensure
they are compliant with the Consumer Duty, in accordance with their usual supervisory
processes.</p>
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