EU and UK Consumer Credit Regulation: Principles, Conduct, and Consumer Protection: Divergence or Convergence of Approach?

Abstract

The regulation of financial services is going through major reform both at European and national level. This article examines the specific case of consumer credit, the new mortgage credit directive, and how European reforms in relation to secured lending on residential property are exhibiting signs of change of direction in relation to the basis of regulation of consumer credit. Whilst at EU level, legislative control is still sector specific, there is an observable shift in the UK towards a single regime for financial services. An examination of the new directive is made, giving a comparison between this latest consumer credit initiative and concurrent reforms in the regulatory framework that are taking place in the UK. It examines the extent to which the EU and UK regulatory initiatives reflect similarity in approach, highlights potential difficulties, and considers whether overall this is a positive development for consumer protection.