Consumer credit financial promotions: FCA CP26/15 proposes removing CONC 3 rules in favour of the Consumer Duty
In short: Consumer credit financial promotions are under FCA review. CP26/15, published on 29 April 2026, proposes removing prescriptive rules from CONC 3 and relying on the Consumer Duty consumer understanding outcome, and opens a discussion on representative APR disclosure, including the 51% threshold. Responses are due by 17 June 2026.
A firm advertising loans, credit cards or point-of-sale finance in the UK complies with two layers of regulation at once: the prescriptive consumer credit financial promotions rules in CONC 3 of the FCA Handbook and the outcomes-based Consumer Duty. The FCA now proposes to remove much of the first layer and rely on the second. The same paper seeks views on whether APR disclosure helps consumers understand the cost of credit. Responses are due by 17 June 2026, and the FCA aims to publish the outcome later this year.
CP26/15, published on 29 April 2026, delivers a commitment the FCA made in Feedback Statement FS25/2 after its July 2024 Call for Input asked which requirements the Consumer Duty had made duplicative. The FCA would make any final rules under its general rule-making power in section 137A of the Financial Services and Markets Act 2000 (FSMA).
How consumer credit financial promotions are regulated today
Consumer credit financial promotions have been FCA-regulated since 1 April 2014, when the consumer credit regime transferred from the Office of Fair Trading and the Consumer Credit (Advertisements) Regulations 2010 were recast as CONC 3 of the FCA Handbook. Specific rules include the clear, fair and not misleading rule in CONC 3.3.1R, the cost disclosure rules in CONC 3.5, and separate rules for credit broking, peer-to-peer agreements and debt solutions.
The APR requirement began in statute. The 1971 Crowther Committee recommended a single annualised cost measure for credit advertising, and the Consumer Credit Act 1974 implemented it as the APR. The Consumer Duty arrived in July 2023 through PRIN 2A, and its consumer understanding outcome (PRIN 2A.5) requires firms to communicate so that retail customers can make effective, timely and properly informed decisions, and to test and monitor whether they do. CP26/15 asks how much of the older, prescriptive layer that standard makes redundant.
What CP26/15 proposes to remove from CONC 3
The FCA proposes to delete the restricted expressions rule in CONC 3.5.12R and the whole of CONC 3.6 on credit secured on land, a section carrying over elements of the repealed Consumer Credit (Advertisements) Regulations 2004. It also proposes to remove guidance on prominence and legibility in CONC 3.2 and 3.3, the ancillary services statement in CONC 3.5.10R and parts of the misleading-practices guidance in CONC 3.3.10G. Draft Handbook text sits in Appendix 1 of the consultation paper.
First, the FCA retains the clear, fair and not misleading rule in CONC 3.3.1R even though the Consumer Duty covers the same ground, expressly because a breach of CONC 3.3.1R gives consumers a private right of action under section 138D FSMA (subject to CONC Schedule 5) and a breach of the Duty does not. Second, the deletions are not a verdict that the conduct they address is now acceptable: the FCA states that the Duty sets a higher standard in many cases and the same conduct remains challengeable under PRIN 2A. The paper also updates CONC 3.3.11AG to reflect the Digital Markets, Competition and Consumers Act 2024 (DMCCA), and proposes that final rules take effect three months after they are made.
The FCA leaves the rules for credit broking promotions (CONC 3.7), peer-to-peer agreements (CONC 3.7A), risk warnings for high-cost short-term credit (CONC 3.4) and debt counsellors (CONC 3.9) out of scope and unchanged, save that the debt-solution examples in CONC 3.3.10G move into CONC 3.9.
| CONC provision | What it requires today | What the FCA proposes |
|---|---|---|
| CONC 3.5.12R restricted expressions | Promotions must not use specified expressions unless conditions are met | Remove; rely on the Duty and CONC 3.3.1R |
| CONC 3.6 credit secured on land | Prescriptive content requirements derived from the repealed 2004 advertising regulations | Remove in full; this lending is rare and mostly sits in the mortgages regime |
| CONC 3.2.3G meaning of prominent | Defines when information counts as prominent | Remove; PRIN 2A.5.7G(3) addresses prominence |
| CONC 3.5.10R ancillary services | Statement required where a compulsory ancillary contract has a cost that cannot be determined in advance | Remove; the consumer understanding outcome applies |
| CONC 3.3.10G misleading practices | Examples of practices likely to breach the clear, fair and not misleading rule | Remove examples (1) to (5); move the debt-solution examples (6) to (8) into CONC 3.9 |
| CONC 3.5.11R security statements | Promotions must state where security may be required and its nature | Amend so the statement is required only where security or a guarantor is inherent to the product |
| Representative APR and representative example (CONC 3.5.3R and 3.5.7R) | Disclosure triggered by access-to-credit, comparison and incentive statements; 51% threshold | No rule change proposed; Chapter 4 seeks views and any change needs a further consultation |
APR disclosure: a discussion, not yet a proposal
Chapter 4 of CP26/15 is a discussion paper, not a rule proposal. It asks whether the representative APR, defined as the rate the firm reasonably expects at least 51% of customers responding to the promotion to receive or better, still supports consumer understanding; whether the mandatory representative example remains justified; and whether the 51% threshold remains appropriate. The threshold was 66% under the Consumer Credit Act 1974 regime and moved to 51% in 2010 to implement the Consumer Credit Directive.
The disclosure obligation is triggered under CONC 3.5.7R where credit advertising implies access to credit for those who might consider it restricted, makes a favourable comparison, or offers an incentive to apply. Including an APR voluntarily triggers the representative example through CONC 3.5.3R(2)(a), an interdependence the FCA itself describes as complex. The FCA’s case for a debate rather than a proposal rests on distortion: a 30-day loan priced at the daily cost cap produces an APR of roughly 1,270% although the interest amounts to 24% of the sum borrowed, and one premium card with a large annual fee discloses a representative APR of 688.5% against an interest rate of 29.4%. Alternatives canvassed include pounds-and-pence disclosures and the Plain Numbers approach, but the FCA’s view is that the existing evidence on alternatives is too limited to justify replacing the APR rules now.
What the proposals change for lenders and brokers
The obligations do not fall away; what changes is how a firm proves compliance. A lender that today maps each promotion against CONC 3 prescription would, under the proposals, show that the promotion meets the consumer understanding outcome, including the testing and monitoring expectations in PRIN 2A.5.10R. Prescription is cheap to comply with because the rule is the specification. An outcomes standard moves the cost into consumer testing and record-keeping that has to satisfy a supervisor after the event, and the FCA says it will monitor use of the new flexibility through supervisory activity and its Product Sales Data returns.
The flexibility matters most in digital channels, where consumer credit financial promotions increasingly run on social media and mobile journeys in which prescriptive formats fit badly. The FCA notes the growth of digitally advertised and managed credit products, including Buy Now Pay Later (BNPL) products, and its social media guidance in FG24/1 continues to apply. The DMCCA sits alongside: the FCA is a public designated enforcer under that Act, and the Competition and Markets Authority can directly enforce the unfair commercial practices rules against misleading credit advertising. For embedded-credit retailers and platforms, the perimeter question comes first, and the regulatory perimeter and market entry page sets out when to take advice on it.
CP26/15 also sits within the wider 2026 reform of UK payments regulation, with the safeguarding, framework contract and BNPL changes already one month into live operation.
Viewpoint
CP26/15 is the first test in practice of the model HM Treasury confirmed for Consumer Credit Act reform on 18 May 2026: prescriptive requirements come out and the Consumer Duty becomes the consumer protection standard. The promotions rules need no legislation, so the FCA can move ahead of the Financial Services and Markets Bill, and the outcome, expected later in 2026, will show how far the FCA will allow firms to depart from prescriptive formats under an outcomes standard. The firms that find outcomes-based regimes expensive are those that treated the prescriptive rule list as the whole compliance job; the consumer testing and monitoring records the Duty expects under PRIN 2A.5.10R become the evidence that replaces the deleted rules. The discussion chapter deserves equal attention to the rule changes: the 51% threshold and the representative example have governed UK consumer credit financial promotions since 2010, and the FCA now seeks views on both.
Frequently asked questions
When does the FCA consultation CP26/15 close?
The FCA consultation closes on 17 June 2026. Responses go through the FCA’s online form or in writing to its Consumer Finance Policy Team. The FCA aims to publish the outcome later in 2026, and proposes that final rules take effect three months after they are made.
Does CP26/15 deregulate consumer credit financial promotions?
No. The clear, fair and not misleading rule in CONC 3.3.1R stays, preserving the private right of action under section 138D FSMA, and the Consumer Duty in PRIN 2A continues to apply to consumer credit financial promotions and every other customer communication. The FCA states that conduct addressed by the deleted provisions remains challengeable under the Duty, which in many cases sets a higher standard.
Is the representative APR being abolished?
No. The representative APR, the representative example and the 51% threshold are the subject of a discussion in Chapter 4 of CP26/15, not a rule proposal. The FCA considers the evidence on alternative cost disclosures too limited to propose changes now. Any change to the APR rules would require a further consultation with draft rules.
Which CONC 3 rules are out of scope?
The risk warnings for high-cost short-term credit in CONC 3.4, the credit broking rules in CONC 3.7, the peer-to-peer agreement rules in CONC 3.7A and the debt counsellor rules in CONC 3.9 are out of scope. The FCA will consider them in other policy work, including the review of the high-cost short-term credit price cap.
For advice on a CONC 3 gap analysis, a response to CP26/15 or the wider reset of UK payments regulation, contact Rob Bratby at Bratby Law.
