The Finance & Leasing Association (FLA) is the leading trade body for the asset, consumer, and motor finance sectors in the UK. In 2007, the FLA introduced Specialist Automotive Finance (SAF) to enhance the standard of finance information provided in showrooms and online, benefiting customers.
In 2017, the Financial Conduct Authority (FCA) announced an exploratory review of the motor finance sector. It wanted to understand the use of motor finance products and assess the sales process employed by firms and whether the products could cause consumer harm.
The Review Process
The review focused on four key areas:
Final Findings
In March 2019, the FCA issued its final report. The key findings were as follows for the key areas:
New Rules on Commission and Commission Disclosure
The FCA has consulted on new rules to prohibit commission arrangements that enable dealers and brokers to change interest rates on credit products. The existing rules on customer disclosure, including commission disclosure, will also be updated. The new rules are expected to come into effect from mid-2020.
What’s Changing In-Line with Consumer Duty?
Historically, SAF was an industry standard, but not a mandated qualification. However, with evolving regulations in our sector, a new provision has been added to the FLA’s Lending Code. This aims to further raise professional standards and support compliance with the FCA’s new Consumer Duty. As a result, FLA members can now only arrange finance through intermediaries (dealers and brokers) that are SAF Approved or accredited under an equivalent training and competence scheme.
What is SAF and When Do You Need Approval?
SAF is an initiative designed for intermediaries (dealers and brokers) to gain comprehensive knowledge of vehicle finance, enhance their expertise and credibility, and boost customer confidence. It has been confirmed that all independent used vehicle dealers must become SAF Approved or equivalent by 1 January 2025.
What Should Motor Dealer Do?
If you are not already SAF Approved, it’s crucial to start looking for training companies that offer SAF accreditation well in advance of the January 2025 deadline.
Our Commitment at Autoguard Group
At Autoguard, we’ve committed to excellence by putting all our agents through SAF accreditation training for the second year running. This ensures we gain formal recognition for our extensive motor finance knowledge, adding further value to our dealer partners. We are excited to continue our partnership with Catalyst, who are approved by the FLA as SAF equivalent. All training is delivered via their award-winning platform, enabling us to stay current with key compliance requirements throughout the year. This dedication ensures we consistently deliver an outstanding customer experience.