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ARTICLE · 26 MAY 2026

Phase 2? We Don’t Need Phase 2 Where We’re Going…

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The UK government has announced significant reforms to the Consumer Credit Act 1974, scrapping the phase two consultation and moving forward with changes that will remove automatic unenforceability sanctions while shifting many prescriptive requirements from statute to FCA rules.

United KingdomConsumer Protection
Jean Price
Jean Price
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Almost a year to the day since HM Treasury kicked off its reform of the Consumer Credit Act 1974 (CCA), we have news - and not quite the news many were expecting.

Most notably, the eagerly awaited phase two consultation has been consigned to history, along with the Sinclair C5. The government had intended to consult on reforms to the scope of regulation and rights and protections under the CCA. It now says it has enough evidence to proceed without doing so.

But that is not the whole story. One view is that the focus has been on the low-hanging fruit. It is hardly surprising that the knottier issues - antecedent negotiations, unfair relationships and connected lender liability - have been kicked down the road yet again, with no clear timetable for when they will be addressed. The government says it “may bring forward proposals in relation to these in future”, so read into that what you will.

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