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Should I take out a short term loan? Woman reading bills

Should I Take Out a Short Term Loan?

Some decisions in life can be made without too much thought, like applying for that new job, or signing up for a charity fun run. Unfortunately, taking out a loan is not one of them. If you are wondering whether a short term loan is right for you, look no further. Just answer these questions to find out if a loan is the best option.

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How Was It For You?

Morning after reflections on my FCA application

By Richard Fuller, Cash Shop owner and BCCA chairman

Waking up on Saturday February 28 2015 I experienced the strangest feeling; it was the first time in several months that the notion (spectre?) of submitting an application for authorisation with the FCA did not occupy my thoughts. After all, it was done. At 4:00 pm the day before – one day before the deadline – I hit the ‘submit’ button. It was a strange feeling; all at once exhilaration, relief, pride, apprehension and then…stress (again!).

What now? When will I hear from my case worker? What questions will s/he ask? How much more documentation will I have to submit? Will they pay me a visit? Will I be invited to Canary Wharf? Both? Will my application be deemed complete?  Will there be a pre-conceived notion of my firm based on the fact we offer High Cost Short Term Credit?

Yes the exhilaration and relief were short-lived, and now I can only wait. I really shouldn’t worry; after all, my firm truly does put the customer at the heart of everything we do. But this is the FCA – seemingly limitless powers, incredibly high standards, and they have just published a report on their thematic review of arrears and forbearance where it found serious non-compliance and unfair practices in every firm it reviewed.

In retrospect, would I have done it any differently? You betcha.

To put things in context, ours is a very lean and ‘flat’ organisation, with the majority of our employees in customer-facing roles in our high street stores, and modest (but earnest) Head Office support. As the only prospective ‘Approved Person’, and Managing Director of the business, the responsibility for preparing our submission fell to me, and only me (with a little help on the ‘techie’ side, of course!). Despite the barrage of calls and emails from firms offering to help me through the application process, I always came back to what the FCA themselves said about out-sourcing: “no one knows your business better than you, and if we have any questions regarding your application, you’re the one we are going to want to speak to, not a consultant“. It helped too that I was a BCCA member and had access to some tremendous guidance material on completing the application and key compliance requirements.  The FCA sent a re-assuringly and relatively brief (5 page) checklist called ‘Credit Ready’ that may have given me a false sense of security that despite all the repeated warnings of “do not leave this to the last minute!!” – this was something I could comfortably manage without too much stress.

Weekly ‘Insight’ updates from BCCA guided me in the right direction as well. I remember back in late November clicking on a link that took me to a tutorial video on accessing the FCA ‘Connect’ system, which would serve as the ‘temple’ to which I would repeatedly return over the next 4 months to chip away at the voluminous online application. Setting up an account was relatively painless. However being technically neither a ‘new’ nor an ‘already authorised’ firm meant it wasn’t going to be as straight-forward as one would hope. But of course, we got there in the end.

Oh, and how easy it all seemed to be! I must have breezed through three or four sections in an afternoon, and was feeling very smug about having a jumpstart on my application before the window even opened. In hindsight, these were obviously the sections that didn’t have ‘yes’ and ‘no’ questions that if you answered ‘yes’ to, another question appeared asking for more detailed information, attachments etc.

So there I was, application started, quality guidance materials from my trade association and access to the regulator via the contact centre, and three months to complete it. But I had to make sure I had price-cap compliant product out in time for consumers. Did I mention we’re a lean organisation? Work had definitely started, but there was more to do – and of course we needed to get this right. So there went December. I may have used ‘Connect’ once or twice in the month, but the focus was on the price-cap.

So in January I thought ‘Great’ – now time to focus on that FCA application! I set about pulling the online application apart, feverishly completing sections that didn’t require massive amounts of data or attachments. I made lists of what I needed and from whom (my IT guy, my accountant, my business partner abroad etc.) I delegated, where necessary, with plans to hold follow-up meetings. I was on top of this!

But then something got in the way – my business. I still had a business to run after all, and the distractions were many. So feeling confident about the progress of my application, I gently put it to one side knowing I still had a good six weeks before the window closed.

Before I knew it, it was February and I had to complete my regulatory business plan. I had multiple fragments of it everywhere and was more than confident that I knew my business inside and out, and just needed to pull it together so it flowed in a clear and concise manner. But how concise? How much is enough? How much is too much? One bit of advice I got was “Write it like they know nothing about your business…but don’t teach them to suck eggs.” Very helpful – thanks!

I also reminded (convinced?) myself that I did my best work under pressure, and by February 1, I was feeling it.

I felt like I was back in school again; some very late nights; writing and re-writing; weekends devoted to the application. This was in between chauffeuring the kids to their various activities. I particularly remember tapping away at the laptop in the passenger seat of my car whilst my 14 year old son attended his American Football practice. We exchanged quizzical looks as he climbed in through the driver’s side door…

BCCA offered a ‘business plan review’ service, and I took full advantage. I needed to know I was on the right track, and the feedback was balanced and extremely helpful. Ironically, much like getting feedback from the FCA I wasn’t told what I did right – just what I needed to change. But there wasn’t a lot, so I was feeling confident. The last 2 weeks consisted of fine-tuning and soul-searching. I felt like I was ready to press the button, but was scared to. More tweaking followed, until I realised that it was ‘now or never’ – it was February 27, after all.

So what would I have done differently?

Well, my initial plan was to submit mid-January, to avoid the stress of leaving it too late. What got in the way?  Reality. The reality of owning a small business that requires a great deal of my input on a daily basis; the reality of having 3 kids, 2 dogs, 2 cats and a hamster, and that my unofficial weekend job is that of “chauffeur”; the reality of accountability and responsibility – both personally and professionally. I got there in the end, but it was a bumpy ride!

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