The Standards of Lending Practice (previously the Lending Code) are voluntary and set the benchmark for good lending practice in the
United Kingdom
The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom (UK) or Britain, is a country in Northwestern Europe, off the coast of European mainland, the continental mainland. It comprises England, Scotlan ...
, outlining the way registered firms are expected to deal with their customers throughout the entire product life cycle. The Lending Standards Board, which oversees the standards, began its work on 2 November 2009, taking the place of the former ''Banking Code Standards Board''.
The Standards of Lending Practice for personal customers covers
loan
In finance, a loan is the tender of money by one party to another with an agreement to pay it back. The recipient, or borrower, incurs a debt and is usually required to pay interest for the use of the money.
The document evidencing the deb ...
s,
credit cardis,
charge card
A charge card is a type of credit card that enables the cardholder to make purchases which are paid for by the card issuer, to whom the cardholder becomes indebted. The cardholder is obliged to repay the debt to the card issuer in full by the d ...
s and
overdraft
An overdraft occurs when something is withdrawn in excess of what is in a current account. For financial systems, this can be funds in a bank account. In these situations the account is said to be "overdrawn". In the economic system, if there i ...
s. The Standards of Lending Practice for business customers covers loans, credit cards, charge cards and overdrafts, with a separate set of standards covering
asset finance.
Other voluntary standards
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Each section of the Standards contains:
* A customer outcome;
* An overall statement of how a firm intends to achieve this outcome; and
* A detailed set of standards that demonstrate the approach.
While a number of these outcomes are well established within firms, new areas do emerge from time to time. As and when they do, the Standards of Lending Practice will evolve to help registered firms develop their approach to them.
References
External links
Lending Standards Board
Banking in the United Kingdom
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