Borrowing guides

Picture a cardholder who opens an email from a card provider: “Good news, we have raised your credit limit.” This is an illustration, not a real person or a statistic. It prompts a practical question. When may a lender raise, or even offer to raise, a credit card limit, and what must it do first? The answer comes from rules in the FCA’s Consumer Credit sourcebook, CONC 6.7 (the Handbook page shows it was last updated on 15 July 2026), together with MoneyHelper’s guidance on limits (read 25 October 2026). This is general information, not advice.

What the email can and cannot do

Rule CONC 6.7.7R is a ban with two triggers. A firm must not increase, or offer to increase, a customer’s credit limit on a credit card or retail revolving credit agreement where:

1. the firm has been advised that the customer does not wish to have any credit limit increases; or
2. the customer is at risk of financial difficulties.

The wording covers an offer to increase as well as an increase itself. The Handbook page dates this rule 19 December 2018.

Who counts as “at risk”

The FCA’s guidance in CONC 6.7.11G says a customer is at risk of financial difficulties for these purposes if the customer:

• is two or more payments in arrears;
• has agreed a repayment plan with the firm; or
• is in serious discussion with a firm that carries on debt counselling, with a view to entering a debt management plan, and the firm has been notified of this.

The same definition is used for CONC 6.7.10R, which says a firm must not increase the interest rate for a customer at risk of financial difficulties, other than where a promotional rate ends. Rate rises have their own rules, covered in this site’s guide to when a lender raises your interest rate.

Saying no, and staying no

Under CONC 6.7.8R, a firm with a credit card or retail revolving credit agreement must let the customer, at any time, reduce or decline offers to increase the limit, and must let the customer decline to receive such offers at all. MoneyHelper says much the same from the customer’s side: a provider may offer a higher limit unprompted, and a customer who does not want it should tell the provider, who should make it easy to opt out.

Notice before an increase takes effect

CONC 6.7.9R covers a limit increase the firm itself proposes. It must notify the customer:

• at least 30 days before the increase takes effect, for a regulated credit agreement for a credit card or a store card; or
• at least 28 days before, for a retail revolving credit agreement other than a store card.

There are two exceptions. The notice is not required where the increase is at the customer’s express request, or where the firm proposes it, the customer agrees at that time and wishes it to take effect in less than 30 or 28 days, as the case may be. The Handbook page dates this rule 19 March 2019.

When the customer is the one asking

MoneyHelper says it is important to work out whether the repayments and interest are affordable, and that overdraft interest rates are usually over 40%, while credit card rates are also high unless the customer is in a 0% period. It adds that increasing a limit because of difficulty paying bills, including credit repayments, will make money problems worse, and that debt advice may help first. MoneyHelper also says:

• it is a good idea for a new customer to wait several months, so the lender can see repayments being made on the original amount;
• going over the limit or missing payments makes an increase unlikely;
• after a refusal, lots of applications elsewhere will damage the credit score.

Where to go for help

For anyone already finding repayments hard, the free debt advice guide explains regulated, free help, and the guide to credit card persistent debt covers a separate FCA duty to contact customers whose payments mostly cover interest and charges.

FAQs

Does the 30-day notice apply if I request the increase myself?

No. CONC 6.7.9R(3)(a) says the notification is not required where the increase is at the express request of the customer.

Can a lender offer an increase if I am two payments behind?

Not under CONC 6.7.7R, read with the guidance in 6.7.11G on customers at risk of financial difficulties.

The bottom line

Under the FCA’s CONC 6.7 rules, a card or retail revolving credit lender must not raise or offer to raise a limit for a customer who has asked for no increases or who is at risk of financial difficulties, must let customers reduce or decline offers, and must give 30 days’ notice (28 for retail revolving credit other than store cards) of an increase it proposes, unless the customer asked for it or agrees to a faster start. Whether to ask for more credit is a separate affordability question. This is general information, not advice.

Sources

• CONC 6.7 Post contract: business practices, rules 6.7.7R to 6.7.11G (FCA Handbook, handbook.fca.org.uk, read 25 October 2026)
• Managing credit well: before you increase your credit limit (moneyhelper.org.uk, read 25 October 2026)

A tax bill that cannot be paid on time needs early attention, because HM Revenue and Customs (HMRC) has wide collection powers. This guide summarises two GOV.UK pages: “If you cannot pay your tax bill on time” and HMRC’s guidance on what will happen if a tax bill is not paid, last updated on 4 September 2026. HMRC’s powers differ between England and Wales, Scotland and Northern Ireland, and the differences are noted. It is general information, not tax or legal advice.

Contact HMRC first

HMRC says that if a taxpayer cannot pay in full and on time, it can work with them to find a way to pay as quickly as possible in a way that is affordable. Before it takes action, except where it suspects fraud or criminal activity, HMRC states it will try to make contact to discuss the situation and agree a way forward. Anyone contacted should reply promptly so that HMRC knows they need support and are not refusing to pay. The Payment Support Service is the route for people living in the UK. Where a taxpayer disagrees with the amount, the guidance also says to contact HMRC. How a tax bill fits among other debts is covered in the guide to priority and non-priority debts.

How a payment plan works

GOV.UK says a person who cannot pay an overdue bill in full may be able to set up a payment plan of monthly instalments, using an online service where eligible. The person needs the relevant reference number, UK bank details with Direct Debit authority, and details of income and spending. If no affordable plan can be agreed, HMRC asks for payment in full. If there are savings or assets, HMRC expects them to be used to reduce the debt as far as possible. An independent adviser’s Standard Financial Statement is accepted as evidence of income and spending.

The monthly amount is based on what remains after rent, food, utility bills and fixed outgoings, and GOV.UK says the person is usually asked to pay around half of that surplus. There is no time limit on a plan. Pension income counts as income, but the value of a pension pot is not counted as savings. If a payment is missed, HMRC will contact the taxpayer and, where possible, try to rearrange the plan. Interest on late payment is charged at the Bank of England base rate plus 4% from 6 April 2025, according to HMRC’s interest rates page, and GOV.UK notes that paying faster reduces the total interest. The current figure should be checked on that page.

Collection through offsets, tax codes and agencies

HMRC states that where there is a debt it may agree a Time to Pay arrangement, use overpaid tax that would normally be refunded to clear other tax debts, or adjust the tax code of a person on PAYE income. Through a tax code it can collect up to 50% of gross income, spread equally across the months available. If a person does not respond, HMRC says it may visit a home or business address to discuss the position, or use a debt collection agency. An agency working for HMRC will contact the person only by letter, text message or phone and never visits a home or workplace.

Enforcement powers as a last resort

HMRC says its enforcement powers are used if it cannot make contact, the person refuses to pay, or a collection agency returns the debt, and describes them as a last resort that differ between nations.

• Taking control of goods (England and Wales). HMRC first issues a formal notice of enforcement costing £75, then visits between 6am and 9pm. Fees are £235 for taking control plus 7.5% of the debt above £1,500, or £110 plus the same percentage for goods removed and sold at auction. Items essential for security and wellbeing are never taken. Northern Ireland uses distraint, and Scotland uses a summary warrant.
• Direct recovery from bank accounts (England, Wales and Northern Ireland). HMRC says this applies when someone owes £1,000 or more and has enough in accounts to cover the debt and reasonable living costs.
• County court action. Charging orders over property, attachment of earnings orders and third party debt orders, which apply in England and Wales only. HMRC says it will not ask a person to draw on pension pots to pay.
• Insolvency. Bankruptcy or winding up is a final course of action, considered only after other recovery options. See applying for bankruptcy.

Help and complaints

HMRC points to free independent debt advice on the MoneyHelper website, and the free debt advice guide covers the options. A taxpayer can nominate an agent, friend or family member to deal with HMRC. GOV.UK says HMRC’s decision on a payment plan cannot be appealed, but a complaint can be made about how a person was treated.

FAQs

Do I have to pay the whole bill at once?

Not necessarily. GOV.UK says a payment plan in monthly instalments may be available, and HMRC will assess whether it is affordable.

Will a debt collection agency visit my home?

No. HMRC says agencies working for it contact people only by letter, text message or phone.

Can HMRC take money straight from my bank account?

In England, Wales and Northern Ireland, HMRC says it can do so for debts of £1,000 or more where the person has enough funds to cover the debt and reasonable living costs, with safeguards.

The bottom line

A tax debt that cannot be paid on time is best dealt with by contacting HMRC at once, since HMRC states it will try to agree a way forward before enforcing, and a Time to Pay plan in monthly instalments is often available. Interest continues on late payment at base rate plus 4%, and enforcement powers such as taking control of goods, direct recovery from bank accounts and court orders differ between the UK nations and are described as a last resort. Free debt advice can help prioritise tax among other debts. This is general information, not tax or legal advice.

Sources

• If you cannot pay your tax bill on time (gov.uk)
• What will happen if you do not pay your tax bill, HMRC guidance last updated 4 September 2026 (gov.uk)
• HMRC interest rates for late and early payments (gov.uk)

Before a business sues an individual over an unpaid debt in England and Wales, the court expects it to follow the Pre-Action Protocol for Debt Claims, which is part of the Civil Procedure Rules. This guide summarises the Protocol as published by the Ministry of Justice and the amendment on email service taking effect on 1 October 2026. Scotland and Northern Ireland have separate procedures. It is general information, not legal advice.

When the Protocol applies

The Protocol applies to any business, including sole traders and public bodies, claiming payment of a debt from an individual, including a sole trader. It does not apply to business-to-business debts unless the debtor is a sole trader, or where another protocol applies, such as one for mortgage arrears. A conflicting regulatory obligation, such as an FCA Handbook rule, takes precedence.

What the letter of claim must contain

The creditor should send a letter of claim before starting proceedings. It must state the amount of the debt and whether interest or other charges are continuing, and explain how the debt arose: for a written agreement, its date, the parties and the fact a copy can be requested; for an assigned debt (see assignment of debt), the original creditor, the assignment date and the new owner. If instalments are being offered or paid, the letter should explain why they are not acceptable, and it must give payment details and the address for the reply form.

The letter must also enclose a statement of account including interest and charges, the Information Sheet and Reply Form from Annex 1 of the Protocol, and a Standard Financial Statement form.

The 1 October 2026 email change

The Protocol says the letter of claim should be sent by post. Before the amendment, the creditor could also use additional contact details such as an email address. The Ministry of Justice states that the amendment was agreed by the Civil Procedure Rule Committee on 3 July 2026 and takes effect on 1 October 2026. The amended paragraph 3.3 says that where the creditor has a personal email address for the debtor, it should also send the letter of claim to that address; if it has no personal email address but has other personal electronic contact details, it should use at least one of those methods. A debtor who explicitly asks not to receive post and gives other details should be contacted using them; a condition in the creditor’s standard terms does not count as such a request.

The reply period and debt advice

If the debtor does not reply within 30 days of the date at the top of the letter, the creditor may start proceedings, subject to other obligations such as those under the FCA Handbook, and must allow for a reply posted late in the period. The Information Sheet tells the debtor to check whether the debt is owed and the amount is right, and lists free advice services including Citizens Advice, StepChange and National Debtline; the guide to free debt advice covers the regulated routes.

If the debtor returns the Reply Form within 30 days, the Information Sheet says the debtor and the business have at least a further 30 days to discuss the debt or seek advice before the business takes court action. If the debtor asks for documents, the business must wait at least 30 days after providing them. A debtor who needs time to pay should be able to agree instalments based on income and expenditure, and a refusal of the proposal should be explained in writing.

Documents, disputes and settlement

Where any part of the debt is disputed, including the amount, interest, charges or the creditor’s compliance with statutes and regulations, the parties should exchange enough documents to understand each other’s position. The creditor must provide a requested document or explain why it is unavailable within 30 days. If disagreement continues, both sides should consider alternative dispute resolution, which the Protocol says may be discussion and negotiation, a complaint to the Financial Ombudsman Service for a debt regulated under the Consumer Credit Act 1974 (see complaining to the Financial Ombudsman Service), or mediation for larger sums. After a repayment agreement, the creditor should not sue while the debtor complies, and must send an updated letter of claim if it later wishes to.

Before a claim is issued

If the matter is unresolved after the debtor has responded, the Protocol says the creditor should give at least 14 days’ notice of its intention to issue, unless urgent action is needed, for example because the limitation period is about to expire; the guide to time-barred debts explains that issue. The court takes non-compliance into account when giving directions but is unlikely to be concerned by minor or technical breaches. The Information Sheet warns that a judgment is usually entered on the Register of Judgments, Orders and Fines for six years unless it is paid within one month, as covered in the guide to county court claims and CCJs.

FAQs

Does the Protocol stop a lender from suing?

No. It sets out the conduct the court expects before proceedings, and the court can take non-compliance into account when managing the case.

What if I only reply after 30 days?

The Protocol allows the creditor to start proceedings if no reply arrives within 30 days of the date on the letter, so replying on time matters.

The bottom line

In England and Wales a business claiming a debt from an individual is expected to send a dated letter of claim with a statement of account, an Information Sheet, a Reply Form and a financial statement, and to wait at least 30 days before suing. From 1 October 2026 the letter should also be sent by email where the creditor holds a personal email address. Replying on the form, asking for documents and seeking free debt advice early all help keep the matter out of court. This is general information, not legal advice.

Sources

• Pre-Action Protocol for Debt Claims, including Annex 1 Information Sheet and Reply Form (justice.gov.uk)
• Pre-Action Protocol update, approved by the Master of the Rolls on 10 September 2026 (justice.gov.uk)
• Civil Procedure Rules: Pre-Action Protocol (PAP) Update: PAP for Debt Claims (justice.gov.uk)

Borrowing with a partner, relative or friend can seem to split the risk, but in law a joint credit agreement usually does the opposite. This guide summarises Citizens Advice pages on debt liability, separation and bankruptcy, which state they apply to England, and the ICO’s guidance on credit files. Scotland, Wales and Northern Ireland have their own versions of that advice, so readers elsewhere should check them. It is general information, not legal or financial advice.

What joint and several liability means

Citizens Advice says that if a credit agreement is signed with someone else, both signatories are jointly responsible for repaying it. If the other person stops paying, the creditor can require the other borrower to pay the full amount, not just their share. The term for this is “joint and several liability”. Citizens Advice lists overdrafts, credit card debts and hire purchase agreements among the debts that may be shared.

A debt owed only in one person’s name is that person’s own. Citizens Advice also notes that an authorised additional cardholder, such as a spouse or partner, cannot be asked by the card company to repay debts on the account, which remain the main cardholder’s responsibility. A guarantor is in a different position again, covered in the guide to guarantor loans.

When a relationship ends

On separation, Citizens Advice says a shared debt means both people are responsible for the whole amount, so if an ex-partner stops paying, the other person has to settle it. It advises making a plan for paying shared debts even while the former partners are still talking, and speaking to a solicitor if there is concern that the ex-partner cannot or will not pay.

For a joint bank account, the advice is that continuing to use it is possible, for example while sharing childcare costs, but closing it and opening separate accounts is probably better. The bank might need the partner’s permission to close it, and if it stays open the partner could access the funds or run up debts for which the other account holder is responsible. If the joint account is overdrawn, Citizens Advice says it can be frozen without the partner’s permission, which stops both people withdrawing money and building up debt.

If one borrower becomes bankrupt

A bankruptcy order restricts how creditors can enforce qualifying debts against the bankrupt partner, but release from most bankruptcy debts normally occurs on discharge, subject to exceptions. Citizens Advice states that the other borrower remains liable for the full amounts, and creditors can pursue that person for the whole sum, so a joint borrower can remain liable for the whole outstanding joint debt. Get advice on the particular debt and jurisdiction. The page adds that where a partner took out joint debts without the other’s knowledge, liability may be disputed, but the person would have to show they did not sign the credit agreement. If they did sign, there may still be another reason they are not responsible. The process is outlined in the guide to applying for bankruptcy.

Credit files and financial links

The ICO explains that when two people have a joint account or are named on the same mortgage, they become financially “linked” at the credit reference agencies. A lender considering an application from one of them can look at the other’s credit file as well, in the same way it could for the applicant, because the lender is considering their circumstances as a couple. The ICO says people should only be linked to someone they hold a joint account with or, in some situations, someone they guarantee, and not merely because they share an address. When a joint account is closed, the ICO says a person can write to the credit reference agencies to request disassociation from the other individual, and that an inaccurate or unknown link should be raised with the agency.

The ICO also warns that when credit is taken out in one person’s name for another, such as a mobile phone contract, a default will appear on the file of the person named in the agreement, not the person who uses the service. More on correcting entries is in the guide to errors on your credit file.

Time limits and joint debts

Citizens Advice gives the usual time limit for most debts as six years from the last written acknowledgement or payment, after which a debt may be “statute barred” if the creditor has not gone to court. For debts in joint names it says that if one borrower writes to the creditor the limit is reset just for that person, whereas a payment by either resets it for both. The wider rules are in the guide to time-barred debts.

FAQs

Am I responsible for half of a joint loan?

Not in the creditor’s eyes. Citizens Advice says the creditor can require the full amount from either signatory if the other stops paying.

Does a partner’s bankruptcy end my liability?

No. A bankruptcy order restricts enforcement against the bankrupt partner, and release from most bankruptcy debts normally comes on discharge, but Citizens Advice says the other borrower remains liable for the full amounts. Free help is described in the guide to free debt advice.

Can I be linked to someone I only live with?

According to the ICO, financial links should arise only from joint accounts or guarantees, and not merely from sharing an address.

The bottom line

In England a joint credit agreement makes each borrower liable for the whole debt, so a partner’s departure, bankruptcy or refusal to pay leaves the other borrower exposed. Freezing an overdrawn joint account, planning shared repayments, closing joint accounts and asking the credit reference agencies to remove links after a split all reduce the risk. A payment by either borrower resets the six-year time limit for both. Free debt advice and, for separating couples, a solicitor can address a specific situation. This is general information, not legal or financial advice.

Sources

• Check if you have to pay a debt (citizensadvice.org.uk)
• Dividing up money and belongings when you separate (citizensadvice.org.uk)
• Joint debts and belongings if your partner is bankrupt (citizensadvice.org.uk)
• Credit (ico.org.uk)

Identity fraud can leave a victim facing loans, cards or catalogue accounts they never opened, and a damaged credit file. This guide summarises advice from the Information Commissioner’s Office (ICO), the government’s Stop! Think Fraud campaign and Cifas, the fraud prevention service, on spotting and dealing with identity theft in the UK. It is general information, not legal or financial advice.

Warning signs

The ICO lists signs that a person may be a victim of identity theft or fraud, including:

• mail from a bank or utility provider that stops arriving;
• unfamiliar items on a bank or credit card statement;
• being refused credit despite a good rating;
• letters from solicitors or debt collectors about debts that are not yours;
• a credit rating that falls although no payments were missed; and
• being told when applying for benefits that you are already claiming.

Identity theft happens when personal information such as a name, date of birth or addresses is stolen and used to impersonate someone, and the ICO notes it can happen whether the victim is alive or deceased.

First steps

Stop! Think Fraud advises acting quickly: contacting the bank and asking it to withhold pending transactions, changing passwords and PINs for bank, email and social media accounts, and reporting lost or stolen documents to the issuing body such as the Passport Office or DVLA. The ICO says unusual transactions should be reported to the bank, building society or card company, and that suspicious credit applications and stolen documents should be reported to the police, with a crime reference number requested. It names Report Fraud for England, Wales and Northern Ireland and Police Scotland for people who live in Scotland. If credit has been taken out in your name, Stop! Think Fraud says to tell the lender immediately. The guide to liability when someone else uses your credit account covers a related situation.

Checking and correcting your credit file

Stop! Think Fraud recommends checking the credit report with Experian, Equifax and TransUnion, because it shows credit applications made in your name; it says a credit check is free and does not affect the credit score. The ICO says anyone can request a copy of the information about their financial standing from a credit reference agency free of charge, by phone or in writing, and that the agency should reply within one month, or up to three months in certain circumstances if it explains why. The ICO adds that nobody needs to join a monthly subscription service for this and that the phrase to look for on agency websites is “statutory report”.

Stop! Think Fraud says mismatches should be reported to the agencies, which alert the lender; the lender investigates and approves removal of the application, a process that can take several weeks. The ICO says it cannot investigate fraud or decide whether an account was opened fraudulently, but it may look at a complaint where a lender has acknowledged an account was fraudulently operated yet refuses to remove the entries, and it notes that each agency has its own Victim of Fraud teams. Many searches in a short time can imply difficulty getting credit, so the fraud should be reported to the organisations concerned. More on disputing entries is in the guide to errors on your credit file.

Extra protection on the credit file

Stop! Think Fraud describes two options for adding a layer of security: a fraud alert, which means lenders must run extra identity checks and which carries a cost through the credit reference agencies, and a Notice of Correction password, which it says can be added free and which a lender must ask for before lending. Separately, the ICO describes a notice of correction as a statement the individual can add to a disputed entry, which anyone viewing the entry will see and which should be considered if they apply for credit.

Cifas Protective Registration

Cifas says that for £30 for two years its Protective Registration service places a warning flag against a person’s name and details in its National Fraud Database. Organisations that use Cifas data then carry out extra checks when those details are used to apply for products or services. Cifas states that the marker does not affect a credit score and is a fraud prevention measure, not insurance against fraud losses. Genuine applications can take slightly longer while checks run. Applications are online only, the registration lasts 24 months unless removal is requested, and Cifas says no email is sent when it expires. Its terms state that it is not a credit monitoring service and does not guarantee prevention of all fraud. It does not cover transactions on products that are already running. The ICO and Stop! Think Fraud both point to the service, although Stop! Think Fraud quotes a different price, so Cifas’s own figure is the one to check.

FAQs

Can the ICO decide whether an account was opened fraudulently?

No. The ICO says fraud is outside its remit and it cannot decide whether an account was opened or operated fraudulently, although it may look at complaints about entries a lender admits are fraudulent.

Does Protective Registration stop all fraud?

No. Cifas says it does not guarantee prevention of all fraud or identity theft and is not a credit monitoring service.

Is a credit check free to carry out?

Stop! Think Fraud says a credit check is free and does not affect the credit score, and the ICO says a statutory credit report is free of charge.

The bottom line

When credit appears in your name that you did not take out, the practical sequence is to tell the bank and the lender, report to the police or Report Fraud and obtain a crime reference number, request statutory credit reports from the three agencies, ask for fraudulent entries to be removed and consider Cifas Protective Registration. The ICO cannot rule on fraud itself but may help where a lender accepts fraud yet leaves the entry in place. Acting quickly shortens the clean-up. This is general information, not legal or financial advice.

Sources

• Identity theft (ico.org.uk)
• Credit (ico.org.uk)
• What to do if your identity has been stolen (stopthinkfraud.campaign.gov.uk)
• Protective Registration and Protective Registration Terms and Conditions (cifas.org.uk)

Many people who bought a vehicle on credit between 2007 and 2024 may be owed money because of undisclosed commission arrangements between lenders and car dealers. The Financial Conduct Authority (FCA) confirmed a compensation scheme on 30 March 2026, but the scheme has since been legally challenged and parts of it are suspended. This guide summarises FCA statements and its consumer page, last updated on 16 September 2026. It is general information, not financial or legal advice.

Which agreements are in scope

The FCA says the scheme covers motor finance agreements taken out between 6 April 2007 and 1 November 2024 where the lender paid commission to the broker, usually the dealer. That includes hire purchase and personal contract purchase deals for a car, motorbike, van or campervan. The FCA estimates around 12.1 million agreements are eligible. Personal contract hire (leasing) is not covered, nor are agreements already decided by the Financial Ombudsman Service or a court.

The three arrangements that matter

Compensation depends on the customer not being told about at least one of three arrangements between lender and broker:

• a discretionary commission arrangement, which let the broker adjust the interest rate to earn a higher commission;
• a high commission arrangement, where commission was at least 39% of the total cost of credit and 10% of the loan; or
• a contractual tie giving a lender exclusivity or a right of first refusal, unless visible links between lender, manufacturer and dealer (such as a common or similar name) existed.

The FCA treats an agreement as fair if commission was £120 or less for agreements starting before 1 April 2014 or £150 or less from that date, or if no interest was charged. Loans above a yearly high-value threshold are also outside the scheme, although those borrowers can still complain in the normal way.

How compensation is calculated

In the most serious cases, around 90,000 consumers whose circumstances resemble the Supreme Court’s Johnson case, the FCA says redress is all the commission plus interest. For most others it is the average of the estimated loss and the commission paid, plus interest. The estimated loss is a percentage reduction in the APR: 17% for agreements from April 2014 and 21% for earlier ones. Simple interest runs at the annual average Bank of England base rate plus 1%, with a minimum of 3% in any year.

The FCA expects compensation to be capped in around one case in three, to the lowest of 90% of commission plus interest and two cost-of-credit limits, and it estimates the average at about £830 per agreement. Someone whose interest rate was in the lowest 5% offered at the time, excluding 0% deals, will not receive compensation.

The legal challenge and the timetable

The FCA says four parties challenged the scheme, and on 2 July 2026 the Upper Tribunal suspended parts of it on terms agreed with those challengers. The Tribunal will hear the challenges on 14 to 18 December 2026 or 16 to 26 February 2027, depending on applications for expert opinion or disclosure. Until the process concludes, the FCA states that lenders do not need to calculate or pay compensation. If the scheme is upheld and there is no appeal, the FCA expects payments to begin in 2027. If it is overturned in whole or part, the FCA says it may instead tell lenders to resolve complaints individually, with an eight-week response time and recourse to the Financial Ombudsman Service, as explained in the guide to complaining to the Financial Ombudsman Service.

Some parts remain in force. The FCA says a lender must tell a complainant who is not owed compensation by 18 November 2026 (agreement from 1 April 2014, complaint by 30 June 2026) or by 18 January 2027 (earlier agreement, complaint by 31 August 2026). Silence from a lender does not mean compensation is due.

What to do now

The FCA advises complaining directly to the lender, which is free. A lender can be found by checking old bank statements, asking the dealer, or looking at the credit file; the FCA also lists lenders on its site. Once a determination arrives, the customer has one month to accept or challenge it, and the lender has one month to pay after acceptance. A customer who disagrees can complain to the Financial Ombudsman Service by the date in the determination letter.

The FCA says a claims management company or law firm is not needed, and fees can be as high as 36% including VAT, so it warns against signing with several. See also the guide to claims management companies and fee caps. Scammers have posed as lenders offering fake compensation, so bank details should be shared only when the sender is certain, and PINs and passwords never.

FAQs

Will I be paid automatically?

Not necessarily. The FCA says consumers who have not complained may be contacted only if they are likely owed money, and those not contacted can still complain to their firm by 31 August 2027.

Does it cover customers who have died?

Yes. The FCA says the scheme covers agreements of customers who have since died, and beneficiaries may be able to claim. The lender is likely to ask for the will or grant of probate.

Is the lender’s failure covered by compensation funds?

The FCA says this type of borrowing is not covered by the Financial Services Compensation Scheme, so redress may not be paid if a lender goes out of business.

The bottom line

The FCA’s motor finance redress scheme could compensate holders of car finance agreements made between 6 April 2007 and 1 November 2024 who were not told about certain commission or tie arrangements, with an average estimated at about £830. Because of the Upper Tribunal challenge, lenders need not calculate or pay redress until the case ends, and any payments under an upheld scheme are expected in 2027. Complaining directly and free of charge, and ignoring cold-call compensation offers, remain the FCA’s main advice. This is general information, not financial or legal advice.

Sources

• FCA confirms motor finance redress scheme, first published 30 March 2026 (fca.org.uk)
• Motor finance scheme partially suspended, 2 July 2026 (fca.org.uk)
• Car finance claims, last updated 16 September 2026 (fca.org.uk)

A bank account is the base for receiving wages and paying bills, and without one, borrowers often turn to costlier credit. The Payment Accounts Regulations 2015 require the largest banks to offer a basic account to eligible consumers across the UK. This guide summarises those regulations as published on legislation.gov.uk and a HM Treasury publication on basic bank accounts. It is general information, not financial or legal advice.

Which banks must offer one

HM Treasury says that under the 2015 Regulations it has designated the nine largest personal current account providers in the UK to offer basic bank accounts to customers who are legally resident in the UK and either have no bank account or are not eligible for a standard current account. The nine are Barclays UK, The Co-operative Bank, HSBC UK, Lloyds Banking Group (including Halifax and Bank of Scotland), Nationwide Building Society, NatWest Group (including RBS and Ulster Bank), Santander UK, TSB and Virgin Money UK. Regulation 22 requires a designated institution to offer the account to any applicant who meets the eligibility criteria.

Who is eligible

Under regulation 23, a consumer must be legally resident in the UK and must either hold no UK payment account with the basic features listed in the Regulations, or be ineligible for all of the bank’s standard payment accounts. Legally resident consumers include those with no fixed address, asylum seekers and some people without a residence permit whose expulsion is impossible. The bank must verify whether the person already has an account, unless it chooses to rely on the person’s declaration.

What the account must offer

Regulation 19 says the account is sterling-denominated and lets the consumer open, operate and close it, pay in cash at counters, withdraw cash in sterling in the UK, and make direct debits, card payments (including online) and credit transfers, with an unlimited number of operations. Access cannot be made conditional on buying additional services or shares.

Regulation 19(5) prohibits an overdraft facility and requires the bank to take all reasonable steps to prevent overrunning. HM Treasury adds that these accounts must be fee-free for standard operations in sterling but otherwise offer the same core services as a standard current account. Regulation 20 says no fee may be charged if an authorised payment fails for insufficient funds, and no fee or interest on any overrun.

How quickly the bank must decide

Regulation 24 says the bank must open or refuse to open the account without undue delay and no later than 10 business days from receipt of the completed application.

When an application can or must be refused

Regulation 25 says a bank must refuse where opening the account would be unlawful, including where it would be contrary to the Fraud Act 2006, the Money Laundering Regulations 2017, section 40(2) of the Immigration Act 2014, or a restriction from the FCA on taking new customers. A bank may also refuse where the person’s conduct toward staff amounts to an offence such as harassment or a public order offence.

When it refuses, the bank must promptly tell the consumer in writing and free of charge the reason, if it may lawfully do so. Since 28 April 2026 the regulations say the reason must be sufficiently detailed and specific to allow the consumer to understand why, unless giving it would be unlawful, and the bank must explain how to complain to it and the right to complain to the Financial Ombudsman Service. The complaint process is described in this site’s guide to the Financial Ombudsman Service.

When an account can be closed

Under regulation 26, a bank may close a basic account only if at least one listed condition is met. They include knowingly using the account for illegal purposes, no transaction for more than 24 consecutive months, incorrect information given at application that would have led to refusal, the person no longer being legally resident in the UK, the person having another qualifying UK payment account opened later, and certain offences against staff.

Where closure is on the grounds of inactivity, loss of residence or another account, the bank must give the grounds and justification in writing and free of charge. The notice period is at least two months for contracts entered into before 28 April 2026, and at least 90 days for contracts entered into on or after that date. HM Treasury explains that the June 2025 amendment also requires a sufficiently detailed reason for closing a basic account.

FAQs

Can a basic account have an overdraft?

No. Regulation 19(5) prohibits an overdraft facility and requires reasonable steps to prevent overrunning.

How long does a bank have to decide?

Regulation 24 says without undue delay and no later than 10 business days from receipt of the completed application.

Must a bank say why it refused?

It must promptly tell the consumer in writing, free of charge, if it may lawfully do so, and since 28 April 2026 the reason must be sufficiently detailed and specific.

What notice must a bank give before closing a basic account?

For contracts entered into on or after 28 April 2026, at least 90 days where closure is on the grounds of inactivity, loss of residence or another account; for earlier contracts, at least two months.

The bottom line

The nine largest UK personal current account providers must offer a basic bank account to eligible, legally resident consumers, with no overdraft and no standard fees in sterling. Banks must decide within 10 business days, give specific written reasons for a refusal, and can close an account only on the grounds the Regulations list, with 90 days’ notice for contracts entered into from 28 April 2026 in the cases the Regulations name. The Financial Ombudsman Service is the route for complaints.

Sources

• HM Treasury, “Basic bank accounts: July 2023 to June 2024”
• legislation.gov.uk, “The Payment Accounts Regulations 2015, regulation 19: Payment account with basic features”
• legislation.gov.uk, “The Payment Accounts Regulations 2015, regulation 23: Eligibility”
• legislation.gov.uk, “The Payment Accounts Regulations 2015, regulation 25: Refusal”
• legislation.gov.uk, “The Payment Accounts Regulations 2015, regulation 26: Closure”
• legislation.gov.uk, The Payment Accounts Regulations 2015, regulation 20
• legislation.gov.uk, The Payment Accounts Regulations 2015, regulation 22
• legislation.gov.uk, The Payment Accounts Regulations 2015, regulation 24

The Financial Conduct Authority’s rules on short-term credit apply across the UK, but formal insolvency is devolved, so a borrower in Northern Ireland uses different procedures from one in England and Wales or Scotland. This guide summarises the Northern Ireland options described by nidirect and the Department for the Economy’s Insolvency Service. It covers Northern Ireland only; the other nations are covered in separate guides on this site. It is general information, not legal or financial advice.

Start with alternatives to formal insolvency

nidirect stresses that a person does not need to become bankrupt because they are in debt, and that bankruptcy is serious because a person may have to give up things of value and their interest in their home. It lists the alternatives as informal agreements, in which the person writes to creditors to agree a repayment timetable, individual voluntary arrangements (IVAs), administration orders and debt relief orders. Related reading: debt management plans and IVAs versus debt management plans.

Bankruptcy in Northern Ireland

According to nidirect, bankruptcy is a legal status that usually lasts a year, during which non-essential assets and excess income are used to pay creditors, and at the end most debts are cancelled. The High Court makes a bankruptcy order after a petition is presented, and petitions can only be presented in the High Court in Belfast. A petition can come from one or more creditors, the debtor, or the supervisor of an IVA.

A debtor filing their own petition completes two forms: the debtor’s bankruptcy petition and a statement of affairs, sworn before an officer of the court or a solicitor. nidirect lists three fees: a deposit of £525 to administer the bankruptcy, a court fee of £189, and a solicitor’s fee of around £7. A creditor can petition where the person owes an unsecured debt of over £5,000, which may be the total of two or more debts.

What bankruptcy involves

An Official Receiver is appointed to protect the person’s assets and acts as trustee where there are none; if there are assets, an insolvency practitioner is appointed. Tools or vehicles needed for work and household items are not treated as assets. A homeowner might have to sell the property, depending on ownership, value and equity. The Official Receiver may ask for an income payments agreement, requiring fixed monthly payments from income for three years, and can apply for an income payments order if it is not signed.

nidirect says the bankrupt person must stop using credit cards and bank or building society accounts, must not obtain credit over £500 without telling the creditor of the bankruptcy, and must not pay creditors directly, with exceptions such as mortgage arrears and unpaid child maintenance. Bankruptcy normally lasts one year, after which the person is discharged regardless of how much is still owed. nidirect adds that it may be difficult to get credit afterwards, as agencies pick up the details from the Insolvency Register and other sources.

Debt relief orders

The Department for the Economy describes a debt relief order (DRO) as lasting 12 months, during which the creditors named in it cannot take action to recover their money without the court’s permission. At the end, provided circumstances have not changed, the person is freed from the debts included. DROs do not involve the courts; they are made through a partnership between the Insolvency Service and approved intermediaries, skilled debt advisers who help with the application.

The Department lists conditions including an inability to pay debts, a car worth no more than £4,000, other assets not exceeding £2,000, disposable income of no more than £75 a month, residence or business in Northern Ireland within the last three years, no other DRO within six years and no other formal insolvency procedure. It says the scheme is not suitable for homeowners because of the asset limits. The Department consulted in 2022 on raising the monetary limits in line with England and Wales, so the current figures should be checked on its page before relying on them. The equivalent process in England and Wales is described in the guide to debt relief orders in England and Wales.

IVAs and administration orders

An IVA is an arrangement in which an insolvency practitioner helps the person negotiate repayment terms. An administration order is made by the Enforcement of Judgments Office, which orders the person to make payments and then distributes them to creditors.

Where to get help and other nations

The Insolvency Service and its approved intermediaries handle DRO applications, and nidirect and the Department publish further guidance. For borrowers elsewhere in the UK, see the guides to bankruptcy in England and Wales and debt solutions in Scotland.

FAQs

Where are bankruptcy petitions heard in Northern Ireland?

nidirect says petitions can only be presented in the High Court in Belfast.

How long does bankruptcy last in Northern Ireland?

nidirect says it normally lasts one year, after which the person is discharged regardless of how much they still owe.

Do debt relief orders go through the courts?

No. The Department for the Economy says DROs do not involve the courts and are made through the Insolvency Service and approved intermediaries.

Can a creditor make me bankrupt in Northern Ireland?

nidirect says a creditor can present a petition if the person owes an unsecured debt of over £5,000, which may be the total of two or more debts.

The bottom line

Borrowers in Northern Ireland have their own formal debt solutions: bankruptcy through the High Court in Belfast, debt relief orders through the Insolvency Service and approved intermediaries, IVAs and administration orders. nidirect and the Department for the Economy set out fees, eligibility conditions and the effects of each, and the monetary limits for DROs are subject to change. Informal arrangements with creditors are described as the first alternatives to consider.

Sources

• nidirect, “Bankruptcy”
• Department for the Economy, “Debt Relief Orders”
• Department for the Economy, “Proposed increases to the Monetary Eligibility Limits for Debt Relief Orders in Northern Ireland” (closed consultation)

Fake lenders often ask for an upfront “fee” paid by bank transfer before any loan is released. Where a person is tricked into authorising a payment to a fraudster, the fraud is called authorised push payment (APP) fraud, and since 7 October 2024 UK bank transfers have carried a reimbursement requirement set by the Payment Systems Regulator (PSR). This guide summarises what the PSR’s consumer page and policy statement say. It applies to transfers between UK bank accounts and is general information, not legal advice.

What the protection covers

The PSR says the protections apply to individuals, microenterprises and charities, and to payments made on or after 7 October 2024. They cover UK bank transfers, meaning money moved from one UK bank account to another over Faster Payments or CHAPS. Card, cash and cheque payments have their own protections. The arrangements do not include credit unions, municipal banks and national savings banks.

A payment to a person who pretended to be a lender and never sent a loan may fit the description of APP fraud, but each case is assessed by the firm on its facts. How advance-fee scams typically work is explained in this site’s guide to loan fee fraud.

How APP fraud differs from other disputes

The PSR distinguishes APP fraud from unauthorised fraud, such as a stolen card being used, which has different protections. It also separates APP fraud from civil disputes, where a person pays a legitimate supplier for goods or services that are not received or are defective and there is no intent to defraud. For those, the PSR says other protections are available under the Consumer Rights Act. A dispute with a genuine, authorised lender is therefore a matter for the complaints route, not for a fraud claim.

Reporting the payment and the 13-month deadline

The PSR advises contacting the bank immediately when a scam is suspected. The report should be made as soon as possible and within 13 months of making the fraudulent payment. During the process, the victim should respond promptly to the bank’s requests for information, after checking that the request is genuine, and report the details to the police or consent to the bank reporting on their behalf. The PSR itself cannot investigate individual cases of fraud.

How quickly the money comes back

The PSR page says a claimant can expect reimbursement within five business days of making a claim. Where a firm needs more information, it can “stop the clock”, for example to assess whether the victim was vulnerable to the scam, but it must reach an outcome within 35 business days. Firms on both sides of the payment are brought into the arrangements, including, in the PSR’s words, those on the receiving end that bank the fraudsters.

The excess, the cap and exceptions

Firms may apply an optional excess of up to £100, or a lower amount, or none at all. The excess cannot be applied to vulnerable consumers. The maximum claim is £85,000, which the PSR says covers over 99% of claims. Its October 2024 policy statement confirmed that level for Faster Payments and said the Bank of England, as operator of CHAPS, decided on the same limit. Individual firms may choose to reimburse more.

The PSR says a claimant will not get their money back if found to have been complicit in the fraud or grossly negligent, adding that gross negligence is a high bar and the exception does not apply to vulnerable consumers.

If the bank refuses or the loss is larger

The bank investigates and tells the victim its decision. If the victim is unhappy, the PSR says the matter can be referred to the Financial Ombudsman Service, and where more than £85,000 is lost and not reimbursed, the PSR page says the case can be raised there too. The Financial Ombudsman Service’s own page gives an award limit of £455,000 for complaints referred to it on or after 1 April 2026 about acts or omissions on or after 1 April 2019; the PSR page still cites an older £430,000 figure, so it is worth checking the Ombudsman’s current limit. The process for such complaints is described in the guide to the Financial Ombudsman Service. The PSR also points to Action Fraud, Victim Support and Citizens Advice.

Before paying anyone

The PSR encourages people to pay attention to bank warnings, use the Confirmation of Payee name check, and pause before sending money or personal details. For lenders, the FCA register check in the guide to confirming a lender is authorised is the natural first step.

FAQs

Is there a time limit for reporting a bank transfer scam?

The PSR says to report as soon as possible and within 13 months of making the payment.

How much can be reimbursed?

Up to £85,000 per claim under the PSR requirement, and firms may choose to pay more.

Does the reimbursement rule cover card payments?

No. The PSR says its measures apply to UK bank transfers over Faster Payments or CHAPS, and card payments have their own protections.

Can a bank charge me anything?

The PSR says firms may apply an optional excess of up to £100, which cannot be applied to vulnerable consumers.

The bottom line

If a fake lender obtains an upfront fee by bank transfer, the PSR’s rules for authorised push payment fraud may entitle the victim to reimbursement of up to £85,000, normally within five business days of a claim and at most 35 business days. The claim should be reported to the bank as soon as possible and within 13 months, and unreimbursed disputes can go to the Financial Ombudsman Service. Checking the lender’s authorisation first avoids the problem.

Sources

• Financial Ombudsman Service, “Compensation” (award limits by date)
• Payment Systems Regulator, “APP fraud reimbursement protections”
• Payment Systems Regulator, “PS24/7 Faster Payments APP scams reimbursement requirement: Confirming the maximum level of reimbursement”

Texts, emails and phone calls offering quick loans are a common irritation for people who have searched for credit. The Privacy and Electronic Communications Regulations 2003 (PECR) set rules for electronic marketing, and the Information Commissioner’s Office (ICO) publishes guidance on them for organisations across the UK. This guide summarises what that guidance says about marketing to individuals. The ICO notes that its guidance is under review following the Data (Use and Access) Act, so details may change. It is general information, not legal advice.

Two sets of rules: financial promotions and PECR

Whether a loan advert is accurate and fair is a matter for the FCA, covered in this site’s guide to credit adverts and financial promotions. Whether a marketer may contact a person by text, email or phone at all is a separate question, governed by PECR. The ICO’s guidance on electronic mail marketing says the rules on electronic mail are in regulation 22 and that marketing to individuals is not allowed without their consent, apart from a limited exception for existing customers.

Texts and emails: consent or the soft opt-in

According to the ICO, a marketer must not send electronic mail marketing to individuals unless they have specifically consented, or they are an existing customer who bought, or negotiated to buy, a similar product or service in the past and was given a simple way to opt out both when the details were first collected and in every message. The sender must not disguise or conceal its identity, and must provide a valid contact address so the recipient can opt out.

The same rule applies to emails, texts, picture and video messages, voicemails and direct messages on social media. The ICO calls the existing-customer exception the “soft opt-in”. It says the exception does not apply to prospective customers or new contacts, such as those from bought-in lists, and that there is no text or email equivalent of the Telephone Preference Service.

Consent has to be specific

The ICO gives an opt-in box as an example of specific consent. The soft opt-in covers only the business the person bought from, or negotiated with, and messages about similar products. The FCA rules for brokers are explained in the guide to credit brokers and comparison sites.

Live marketing calls

The ICO’s guidance on telephone marketing says the rules on live marketing calls are in regulations 21, 21A and 21B. A marketer must not make unsolicited live calls to anyone who has said they do not want the calls, or to any number registered with the Telephone Preference Service (TPS) or the Corporate TPS, unless the person has specifically consented, even if they are an existing customer. The caller must say who is calling, allow the number or an alternative contact number to be displayed, and provide a contact address or freephone number on request.

The TPS is a central register of individuals who have opted out of live marketing calls. Calls to a number not on the register are permitted only if the person has not previously objected and the call is not marketing claims management services. In practice, marketers therefore need to screen call lists against the register and keep their own do-not-call list.

Automated calls

Automated calls are covered by regulation 19, and the ICO describes the rules as stricter. An automated marketing call, one made by an automated dialling system that plays a recorded message, is not allowed unless the person has specifically consented to that type of call. General marketing consent, or consent to live calls, is not enough. Each automated call must include the marketer’s name and a contact address or freephone number, and the number must be displayed.

Claims management and debt-related calls

The ICO says unsolicited live calls are not allowed for the purpose of claims management services unless the person has specifically consented. The fees of such firms are described in the guide to claims management companies. Pension scheme marketing calls are also tightly restricted, according to the guidance.

If the contact looks like a scam

A message that asks for an upfront fee before a loan is released may be a fraud rather than a marketing breach; see the guide to loan fee fraud for how to check a lender.

FAQs

Can a lender text me if I applied for a loan with them once?

The ICO says the soft opt-in can apply to an existing customer who bought, or negotiated to buy, a similar product, provided they were offered a clear opt-out when their details were collected and in every message.

Is there a register to stop unwanted texts?

The ICO says there is no text or email equivalent of the TPS. The TPS covers live marketing calls.

Can a company use a recorded-message marketing call?

Only if the person has specifically consented to automated calls, according to the ICO; general marketing consent is not enough.

Can a company phone me about claiming back on a loan?

The ICO says unsolicited live calls for claims management services are not allowed unless the person has specifically consented.

The bottom line

PECR requires marketers to have specific consent before sending texts or emails to individuals, with a narrow soft opt-in for existing customers, and to screen live marketing calls against the TPS. Automated calls need consent that specifically covers them, and claims management calls need specific consent as well. The ICO’s guidance is under review, so the current position on the ICO’s website should be checked when relying on any detail.

Sources

• ICO, “Electronic mail marketing” (Guide to PECR)
• ICO, “Telephone marketing” (Guide to PECR)