SAF APPROVED EQUIVALENCE - Critera and process

Criteria for equivalence

All six criteria must be met

• Either (1) the programme incorporates SAF Expert or Tailored SAF Expert training material in full or (2) the programme covers the SAF Expert or Tailored SAF Expert syllabus in comparable depth so that equivalent understanding is assured (see belowfor the difference between the SAF Expert and Tailored SAF Expert syllabus).

• Programme training and test materials are reviewed at least annually so that relevant regulatory and market developments are incorporated.

• The testing process has comparable integrity and rigour to SAF Expert / Tailored SAF Expert. This could include, but is not limited to, randomised question banks, appropriately challenging pass marks, independent oversight, security.

• All relevant customer-facing staff at the user firm study the material and pass a test at least annually.

• The programme has a method to confirm and verify that all customer-facing staff at the user firm have used the programme and passed each year before the firm is awarded SAF Approved equivalence.

• The SAF Approved Equivalent status of user firms is verifiable electronically by funders complying with the FLA Lending Code and / or accessible by a tool that may be developed by FLA or via the SAF platform to provide funders with a complete register of SAF Approved and equivalent firms.

Equivalence application process

• Applicants are invited to submit material to the Equivalence Decision Panel (EquivalenceDecisionPanel@fla.org.uk), in strict confidence, which demonstrates compliance with the criteria for equivalence above. There is no set manner in which this material should be submitted.

• All members of the Equivalence Decision Panel have signed a non-disclosure agreement undertaking not to disclose any information submitted as part of an application for equivalence.

• No information submitted will be shared with a competitor programme, and no member of the Equivalence Decision Panel is from a competitor programme (including the FLA).

• Applications for the first phase of approvals should be submitted by Thursday 29th September.

• The Equivalence Decision Panel is scheduled to meet on Thursday 6th October to determine the first phase of approvals.

• Applications for approval can continue to be submitted after this date for subsequent consideration and approval.

Equivalence Decision Panel

• Steve Hogg – Black Horse (Chair)
• Debbie Taylor – Alphabet


SAF SYLLABUS

SAF Expert Syllabus = all modules

Tailored SAF Expert Syllabus = all modules except those in italic which do not relate to products provided by the user firm (A2-10)

SECTION A – FINANCE PRODUCTS

A1 – Introduction to Automotive Finance
A1.1 The automotive finance marketplace
A1.2 Automotive finance providers
A1.3 Economic factors and the cost of motor finance
A1.4 Summary of automotive finance products

A2 – Hire Purchase
A2.1 Definition
A2.2 Form, Use & Option to Purchase
A2.3 Early Settlement
A2.4 End of Contract
A2.5 Fees and Charges
A2.6 Profiles
A2.7 Title

A3 – Personal Contract Purchase
A3.1 Definition
A3.2 Form and Use
A3.3 Early Settlement
A3.4 End of Contract
A3.5 Fees and Charges
A3.6 Profiles
A3.7 Title
A3.8 Guaranteed Minimum Future Value (GMFV)

A4 – Personal Loan
A4.1 Definition
A4.2 Form & Use
A4.3 Early Settlement
A4.4 End of Contract
A4.5 Fees and Charges
A4.6 Profiles
A4.7 Title

A5 – Contract Hire
A5.1 Definition
A5.2 Form and Use
A5.3 End of Contract

A6 – Conditional Sale
A6.1 Definition
A6.2 Form & Use
A6.3 Title

A7 – Credit Sale
A7.1 Definition
A7.2 Form & Use

A8 – Lease Purchase
A8.1 Definition
A8.2 Title

A9 – Finance Lease
A9.1 Definition
A9.2 Form and Use

A10 – Secured Loans
A10.1 Definition
A10.2 Form and use
A10.3 Fees and charges

A11 – Interest Rates
A11.1 Definition and use

A12 – Finance Structures and Profiles
A12.1 Monthly payments / charges
A12.2 Interest
A12.3 Advances / deposits / balloon Payments / mileage
A12.4 Term and structure
A12.5 End of contract


SECTION B – REGULATION & LEGISLATION

B1 – Changes to consumer credit regulation
B1.1 The Consumer Credit Act
B1.2 The transfer of regulatory responsibility
B1.3 The Consumer Credit Sourcebook (CONC)
B1.4 Who is regulated and who is not

B2 – The Financial Conduct Authority (FCA) and principles-based regulation
B2.1 The FCA’s objectives
B2.2 The FCA’s regulatory toolkit
B2.3 Principles-based regulation B2.4 FCA supervision of firms

B3 – FCA permission and authorisation
B3.1 FCA authorisation
B3.2 Appointed representatives
B3.3 Full and limited permission
B3.4 Threshold conditions, SM&CR and approved persons
B3.5 Authorisation for the sale of general insurance B3.6 Rules for the sale of guaranteed asset protection insurance

B4 – Financial promotions
B4.1 What is a ‘financial promotion’?
B4.2 The FCA’s rules on financial promotions
B4.3 Annual Percentage Rate (APR) and written examples

B5 – Pre-contract requirements
B5.1 The FCA rules
B5.2 Adequate explanations of finance products
B5.3 Pre-contract information and copies of agreements
B5.4 Pre-contract information and copies of agreements, KYC, preventing fraud and digital onboarding

B6 – Post-contract information and rights
B6.1 Information which must be provided post-contract
B6.2 The right to withdraw and cancellation rights
B6.3 Early settlement of an agreement
B6.4 Voluntary terminations
B6.5 Arrears and default
B6.6 Collections and repossessions
B6.7 Consumer Rights Act

B7 – Responsible lending
B7.1 The FCA’s rules on responsible lending
B7.2 Responsible lending considerations for finance companies
B7.3 Prohibited actions

B8 – Vulnerable customers and mental capacity
B8.1 Vulnerable customers and the FCA’s mental capacity rules
B8.2 Identifying and assisting vulnerable customers
B8.3 The BRUCE tool

B9 – Financial incentives
B9.1 FCA requirements on financial incentives including commission
B9.2 Risks posed to customers from incentive schemes – FCA rules prohibiting discretionary commission
B9.3 Good and poor practice linked to financial incentives

B10 – Unfair relationships and the unfair trading regulations
B10.1 What are unfair relationships?
B10.2 The Consumer Protection from Unfair Trading Regulations
B10.3 The impact of the regulations on the motor industry

B11 – Distance selling
B11.1 Distance selling and the regulations governing it
B11.2 The difference between distance selling, on-premises selling & off-premises selling
B11.3 How the rules and regulations change for distance credit and hire agreements

B12 – Asset security and registration
B12.1 Asset registration and recording ownership of vehicles
B12.2 Industry best practice

B13 – The General Data Protection Regulation
B13.1 Who GDPR applies to
B13.2 The data protection principles and rights of individuals

B14 – Anti-money laundering
B14.1 Financial limits
B14.2 The responsibilities of companies and individuals

B15 – The FLA Lending Code and consumer credit dispute resolution
B15.1 What is the FLA?
B15.2 The FLA’s Codes of Practice
B15.3 The FCA’s complaint-handling requirements and the FOS