Home FCA Handbook CONC CONC 7 CONC 7.7 Application of interest and charges
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CONC 7.7 Application of interest and charges

26/06/2026G

When levying charges for debt recovery on a customer in default or arrears difficulties firms should consider their obligations under Principle 6 to pay due regard to the interests of customers and treat them fairly and the requirement to act to deliver good outcomes for retail customers under the Consumer Duty, as applicable.

[Note: paragraphs 3.1 and 3.10 of DCG]

01/04/2014R

A firm must not claim the costs of recovering a debt from a customer if it has no contractual right to claim such costs.

[Note: paragraph 3.11b of DCG]

01/04/2014R

A firm must not cause a customer to believe that the customer is legally liable to pay the costs of recovery where no such obligation exists.

[Note: paragraph 3.11a of DCG]

01/04/2014G

Where a firm has a contractual right to levy default charges, a regulated credit agreement must state the charges and the conditions for making the charge under, as the case may be, the Consumer Credit (Agreements) Regulations 2010 (SI 2010/1014) or the Consumer Credit (Agreements) Regulations 1983 (SI 1983/1553).

[Note: paragraphs 3.11c of DCG and 7.15 of ILG]

01/04/2014R

A firm must not impose charges on customers in default or arrears difficulties unless the charges are no higher than necessary to cover the reasonable costs of the firm.

[Note: paragraphs 3.11 of DCG and 7.15 of ILG]

04/11/2024G

When considering whether any costs may be reasonable, a firm may have regard to the frequency and nature of the events to which the costs relate and whether they arise directly from the customer being in default or arrears difficulties.