What is the Consumer Credit Act 1974

The Consumer Credit Act 1974 (CCA 1974) protects the rights of consumers. It sets out how most retail lending and credit is handled in the UK. It determines how businesses that lend money or offer goods and services on credit conduct their business and advertise those products, as well as requiring them to be licensed by the Financial Conduct Authority (FCA).

The CCA 1974 regulates the relationship between consumers (ie, private individuals) and lending institutions (creditors) where a credit or hire agreement is provided (ie, the relationship between lender and client).

The CCA 1974 only applies to ’regulated agreements’, where the client is an individual (ie, a consumer) and where a statutory exemption does not apply.

The Act gives clients a variety of rights against lenders, such as the right to a ’cooling-off period’ or to pay off their credit early, and lays down certain procedural requirements to control the lending process.