Hire-Purchase (and PCP), Consumer Hire and Buy-Now-Pay-Later Products: New Central Bank authorisation requirements
The new Consumer Protection (Regulation of Retail Credit and Credit Servicing Firms) Act 2022 (which requires a commencement order before it becomes operational) extends the Central Bank of Ireland’s retail credit and credit servicing regimes by requiring that:
- any person carrying on a business of offering hire purchase products (including personal contract plans (PCPs)) or consumer-hire products to consumers, and any other person providing credit directly or indirectly to consumers, be authorised by the Central Bank as a retail credit firm (if not already subject to Central Bank authorisation); and
- any person who services such products be authorised by the Central Bank as a credit servicing firm.
As the new Act will regulate indirect forms of credit, providers of buy-now-pay-later products and other similar products which allow a person to pay in instalments will now need Central Bank authorisation (unless they can avail of a recently-narrowed exemption under the Consumer Credit Act 1995).
For more information, read the latest update from our Financial Regulation Group.