Who regulates car leasing companies?
If you are considering leasing a car, you may be wondering which companies are reputable and who regulates them.
Throughout this article, we will provide clear information on who regulates the industry and how you are protected.
At OSV, we have complied with trade bodies and codes of conduct since 1997 and have years of experience in educating and advising customers.
As we have answered hundreds of customer questions each and every day, we wanted to help you to have all of the answers you need to know exactly how you are protected when you lease a car.
The Finance and Leasing Association
The Finance and Leasing Association (the FLA) formed in 1992 and is the leading trade body for consumer and motor finance sectors in the UK.
Any member of the FLA signs up to a specific Lending Code. This sets out the best practise in consumer lending. If at any time you think that the FLA member you are dealing does not comply with the code, you can take advantage of their conciliation service. This is in place to support and assist you as a customer.[vc_single_image image=”43565″ img_size=”article-image”]Over 80% of all private new registrations were financed by FLA members. Therefore, the FLA are very important in the regulation of the leasing sector.
The FLA set out the knowledge that a vehicle finance provider should have. Therefore, reputable companies will have to pass qualifications, such as Specialist Automotive Finance (SAF).
If you are speaking with a SAF approved contact then you can be reassured that they will be an expert in vehicle finance.
We would recommend that you find out what qualifications your vehicle supplier has so that you know you are speaking with an expert.
The British Vehicle Rental and Leasing Association (BVRLA)
[vc_single_image image=”43566″ img_size=”article-image”]If you are dealing with a BVRLA member company then you can be safe in the knowledge that you will receive a professional service.
The Codes of Conduct stipulate the standards which the BVRLA expects its members to adhere to. This applies to all aspects of their business and operational procedures.
Adherence to the Codes is mandatory for membership and breaches of this Code can result in member being stripped of their BVRLA membership.
When you deal with a BVRLA member, you can expect;
- Support throughout the duration of your contract
- In the even that you are dissatisfied, a complaints process that is fair and reasonable
- Appropriate post-contract information so that you have a full understanding of your commitments when leasing. This will also help you understand how to avoid any unnecessary problems.
- Fair end of contract procedures
- Staff will be adequately qualified and have the required knowledge to meet your requirements
- You will receive clear and transparent information
This is only a brief introduction to their role as a trade body. However, the main point to be aware of is that the BVRLA have strict standards and want to uphold the integrity of the rental and leasing sector. Therefore, customer satisfaction and appropriate support is of utmost importance.
The Financial Conduct Authority (FCA)
The FCA are the most important body for regulating how customers are treated with regard to the sales of financial products.
In car leasing, there are various types of leasing and finance options. So it’s important that you get the right products for your needs. It’s even more important that you do not get mis-advised or given incorrect recommendations.
The FCA have 3 statutory objectives;
- To protect regulated customers
- You are regulated if you are an individual, a sole trader or a partnership with up to 3 partners
- To protect the integrity of the financial industry
- To promote effective competition in the interest of consumers
So, what does this mean for you?
If you deal with an FCA regulated business, you can be reassured that they will be expected to comply with the ‘Treating Customers Fairly Principles’. These include;
- Ensuring advice is suitable for your needs
- Providing the correct product
- The product performs to your expectation
- No unreasonable post sale barriers
- Clear and transparent information
- Products are designed and promoted to meet the needs of the consumers
How does this help you with your purchase?
By dealing with a FCA regulated business, you can be confident and know that mis-selling is strictly against the culture of that business.[vc_single_image image=”43567″ img_size=”article-image”]
To become FCA regulated, the company must prove that treating customers fairly is central to their company culture. They must also provide adequate resources to meet customers’ needs. They will also have a complaints policy that meets the requirements of the FCA. Therefore, you can be reassured that any complaint and dispute will be taken seriously and handled with care.[vc_single_image image=”43568″ img_size=”article-image”]If you are dissatisfied with your response, you can contact the Financial Ombudsman Service and they will investigate on your behalf. If it is deemed that you have not been treated fairly, the FCA can enforce penalty for the business and stipulate compensation for you.
If you are leasing for the first time, you may be concerned about paying more than necessary. Or maybe you are worried you won’t get the best deal or advice. You may also be worried that you may not get all the information you need. We understand this, car leasing can be very daunting.If you deal with an FCA regulated company, they will be audited frequently and must provide you with clear and transparent information. Penalties for not doing so can be large financial sums, or even imprisonment. So, you can be assured that if you are dealing with a company that is regulated by the FCA, they will have strict guidelines to follow and you are protected. For more information on what accreditations to look for in a leasing company, you can read our article here.
So, if you are wondering which companies to trust and who is reputable, then you should check for the above memberships and accreditations. You should find these on the company’s websites and if not, ask when you speak to them.