Our Policy Statement and Final Rules on the debt packager referral fee ban (PS23/5) was published on 2 June 2023. In it we said that existing debt packagers and their existing Appointed Representatives (ARs) at that time could benefit from an implementation period of 4 months up to 2 October 2023.
Any new debt packager firms, or those restarting their debt packager business, including newly appointed ARs, have already been subject to the ban from 2 June 2023.
Today is the final day of the implementation period and all debt packager firms must now be ready to comply with the ban. Where CONC 8.3.11R applies, debt packager firms who benefited from the implementation period must ensure they do not receive any commission, fee or any other financial consideration (referral fees) from a debt solution provider for any referral or related service conducted after 2 October 2023. The ban does not apply to work carried out before 3 October where the firm has an accrued contractual right to payment for the referral, or related services, in relation to a customer.
Any firms who act as principal to ARs who would fall under the scope of the ban if they were an authorised person must take all reasonable steps to ensure that these ARs also comply with the ban.
Where the ban applies, it does not only apply in relation to Individual Voluntary Arrangements (IVAs) and Protected Trust Deeds (PTDs), but to all debt solutions except payments made in certain circumstances which are excluded by CONC 8.3.14R.
We also remind lead generators and insolvency practitioners to consider the guidance in PERG 17.7 that we published in June along with our final rules and apply for authorisation where appropriate.