The Financial Conduct Authority’s Consumer Duty is a 2023 regime that asks firms in the consumer-credit space to deliver four outcomes for the people they serve: fair price and value, products and services that meet genuine needs, communications a retail customer can understand, and support that actively helps when something goes wrong. Credicorp lends to UK limited companies, which is outside the consumer-credit perimeter under Article 60B of the FSMA RAO 2001, so the Duty does not legally bind us. We apply it anyway, by choice — and this article is the honest description of how each of the four outcomes plays out in our day-to-day operation.
Price and value: the cap that binds the worst case
Consumer Duty’s first outcome asks whether what the borrower pays is fair for what they receive. Our answer is the 100% total-cost cap — interest and fees combined on any single Credicorp loan or drawing will never exceed the amount borrowed. Borrow £400; the most you ever repay back is £800. That is not a marketing target: it is in clause 6.3 of the Business Loan Agreement and clause 6.4 of the Revolving Credit Facility Agreement, and it is named on page 1 of every Key Information Sheet. The cap binds even if the loan defaults, even if late-payment fees apply, even if the loan runs for far longer than originally planned. It is the guardrail that stops a short-term cashflow problem becoming a runaway debt.
Products and services that fit the actual need
Outcome two is about products that meet the borrower’s genuine need rather than the lender’s commercial preference. Our two products are designed around two distinct, frequently-observed business-lending shapes: a one-time business loan for a specific named purchase (a piece of equipment, a single VAT bill, a marketing campaign), and a revolving facility (Credicorp Flex) for ongoing seasonal cashflow where the company genuinely doesn’t know in advance how much it will need or when. We do not push a one-time loan on a customer with revolving cashflow needs, and we do not push Flex on a customer making a discrete one-off purchase. The application flow asks about the purpose up front and routes accordingly.
Consumer understanding: documents people can actually read
Outcome three is the readability test. Our binding agreements are in English (English-law contracts), but they are accompanied by a plain-English summary sheet, available in Welsh, Scottish Gaelic and Scots; a Simple View accessibility mode (single column, plainer wording, more icons); and large-print PDF variants of every contract document. The Key Information Sheet leads with a five-bullet summary so the borrower sees the headline terms before being asked to read the full agreement. We test new documents against a Plain English Campaign-style reading level before they ship.
Consumer support: forbearance that begins early
Outcome four is what happens when things go wrong. Our forbearance process begins on Day 0 — the same day a Direct Debit collection fails, with an email that does not threaten or charge. We carry three standard forbearance shapes (reduced payment, payment holiday, term extension) and we do not register missed-payment markers against payments made on time under an active arrangement. Free independent advice from Business Debtline is signposted in every reminder. The forbearance team and the collections team have explicit policy guardrails: we never escalate while a genuine arrangement is being negotiated.
How we measure ourselves
An internal outcomes scorecard, reviewed monthly, tracks: forbearance request approval rate, vulnerability-flagged customers as a share of the book, complaints upheld in the customer’s favour, time from request to first substantive response, and the rate of customers entering arrears within six months of drawdown. The board reviews the scorecard quarterly and any deterioration in any metric triggers a documented response. We publish the topline figures annually in our Responsible Lending summary.
What we are explicit about not claiming
Voluntary adoption is not the same as regulatory protection. Customers of Credicorp do not have recourse to the Financial Ombudsman Service or the Financial Services Compensation Scheme. After our internal complaints process, the final escalation is the courts. We state this on every legal page and on the KIS itself. The Duty is the standard we hold ourselves to; it is not a substitute for the statutory protections that consumer credit carries — and we will not pretend otherwise.