The Lending Standards Board, long a fixture of UK lending self-regulation, has been winding down — a development that passed with little fanfare outside the industry but raises a genuine question: what happens to voluntary lending standards when the body that maintained them steps back? This is commentary on that transition, and on why a lender can, and in our view should, hold itself to recognised standards even where no one is obliging it to. We approach this as a firm whose lending sits outside the consumer-credit regime, looking at standards we choose to align with rather than ones imposed on us.
What the Lending Standards Board did
The Lending Standards Board oversaw a set of voluntary commitments that participating firms made about how they would treat customers — most notably the Standards of Lending Practice, which covered areas such as product information, financial difficulty, and the treatment of vulnerable customers. Adherence was voluntary, but registration signalled that a firm had agreed to be held to a recognised benchmark of conduct.
That model — industry self-regulation sitting alongside, rather than inside, statutory regulation — has a long history in UK finance. Its value was never that it was legally binding; it was that it created a shared, written expectation of good practice that customers and firms could point to.
The Standards of Lending Practice still stand
The important point for 2025 is that the winding-down of the Board does not erase the standards themselves. The Standards of Lending Practice, including the version published in September 2024, remain an articulate and authoritative statement of what good lending conduct looks like. A document does not lose its usefulness because the body that published it is reorganising. The substance — clear information, fair treatment, proper support in difficulty — is as relevant as it ever was.
For a firm minded to do the right thing, this is in some ways liberating. Standards that exist as a reference point, detached from a registration scheme, can be adopted on their merits. The question becomes not “are we required to comply?” but “is this a good way to treat people?” — and the answer to that does not depend on which body, if any, is keeping a register.
Where this leaves business lending
It is worth being clear that much of the consumer-focused standards architecture was never aimed at lending like ours in the first place. We lend to companies — bodies corporate — for business purposes, which sits outside FCA consumer-credit regulation under Article 60B FSMA RAO 2001. The Standards of Lending Practice are framed around consumer and small-business lending, and our product is not consumer credit. So neither the standards nor the Board ever bound us.
But “not bound” is not the same as “not interested”. The principles those standards express — that costs should be transparent, that customers in difficulty deserve a fair and humane process, that vulnerability should be met with support — translate readily to business borrowing. There is nothing about lending to a company rather than an individual that makes those principles less worth following.
What voluntary alignment looks like for us
In practical terms, aligning voluntarily with recognised good practice means building it into how we operate rather than treating it as a box to tick. For us that includes showing every figure on your Key Information Sheet (KIS) before you sign; an honest acknowledgement that short-term borrowing is expensive; a published process for financial difficulty; and a considered approach to vulnerability, set out on our vulnerability page. We describe our wider approach in how we lend and on our transparency page.
The limits of voluntary standards
We would be doing readers a disservice if we left the impression that voluntary alignment is equivalent to statutory protection. It is not. Choosing to follow a standard is not the same as a customer having an enforceable right, and it is certainly not the same as access to an ombudsman — which, as we have written elsewhere, our borrowers do not have. Voluntary standards depend on the firm meaning what it says. The honest position is that they raise the floor of conduct without creating the external backstops that the consumer regime provides. That is a real difference, and the right response to it is more transparency about cost and process, not less — which is the approach we try to take.
