--- title: "AR oversight for credit broker and introducer networks · Merrin" description: "For lenders and broker networks whose ARs are credit brokers, introducers, second charge brokers and debt firms: scope, referral fees and the IAR boundary." url: https://merrin.ai/industries/credit-broking --- [Industries](https://merrin.ai/industries) Credit broking & lending # Keep broker and introducer networks in scope For lenders and broker networks whose ARs are credit brokers, introducers, lead generators, second charge brokers and debt firms. [Schedule a demo ](https://merrin.ai/demo) _(Illustrative returns view with fictional data)_ ## Brokers, introducers and the line between them Credit networks lean on introducers. The FCA calls IARs lower risk provided they stay strictly within their limited scope, and that boundary is where much of the oversight effort goes. **introducer ARs across all sectors in March 2026** 12,619 **ARs in total, under 2,431 principals** 33,347 **AR relationships ended by principals between July 2022 and September 2023** 1,300+ ## The rules that matter in this sector **What an AR cannot do** An AR can broke credit, carry on consumer hire and the debt activities, but can lend only interest-free with no charges. Regulated claims management can never be carried on as an AR (SUP 12.2.7). **The introducer boundary** An IAR may only effect introductions and distribute non-real-time promotions. It cannot arrange regulated mortgage contracts, including second charge loans, or advise on credit secured on land (SUP 12.2.8G, SUP 12.5.7R). **Second charge is a mortgage** Since March 2016 second charge loans have been regulated mortgage contracts under MCOB, not CONC. An AR doing that business may have only one principal for it (SUP 12.5.6AR). **No referral fees on debt** Debt packagers may not take commission or fees from debt solution providers for referrals (CONC 8.3.11R), and principals must take all reasonable steps to make sure their ARs comply (CONC 8.3.16R). **Brokers say they are brokers** Commission must be disclosed and explained (CONC 4.5), and a broker that is not a lender must say so prominently, using its Register name (CONC 3.7). ## What the FCA has said recently 1. 20 May 2026 ### FCA regulatory guide for credit brokers A pilot guide for small brokers, including ARs and IARs, with a section on using appointed representatives. 2. 12 February 2026 ### HM Treasury consults on the AR regime Proposals include an FCA permission to act as a principal, Ombudsman jurisdiction over ARs and bringing ARs into SM&CR. No response had been published by October 2026. 3. 23 October 2024 ### FCA review of consumer credit firms Some principals had no quantitative assessment of the risks their ARs pose. The FCA encourages ways to quantify AR oversight risk. 4. 23 April 2024 ### FCA review of credit broking principals Good practice included calling customers introduced by an IAR to confirm what was said, and controlling quoting software so the principal can suspend access. 5. 2 October 2023 ### Debt packager referral fee ban The ban in PS23/5 applied to referrals from this date, after the FCA found widespread non-compliance in fee-paying referrals. ## Between annual reviews **An introducer starts to advise** Returns collect introduction volumes and the material each IAR uses, so a pattern that looks like arranging stands out at review. [Returns & tasks](https://merrin.ai/features/returns) **A broker joins another principal** The FCA Register is checked for new principals and changes to each firm's permissions, and each finding is recorded as an issue. [Monitoring & issues](https://merrin.ai/features/monitoring) **Risk you can explain** Each firm gets a likelihood and impact score from its returns, complaints and findings, with the factors behind it, which is the quantitative view the FCA asked for. [Risk & completeness](https://merrin.ai/features/risk) ## What to collect from each AR Merrin schedules these as returns, by risk tier, and puts each one with the firm or Individual who needs to provide it. [Returns & tasks](https://merrin.ai/features/returns) - Lender panel, commission or fee per lender, and the fees charged to customers - Promotion content, including lead generation and social media - Complaints by category, and regulated and non-regulated revenue for REP025 - From IARs: introduction volumes, the material used and a confirmation of scope - From debt firms: referral sources and destinations, and confirmation that no referral fees are received - From second charge brokers: advice and suitability files, and confirmation of no other principal for mortgage business - Details of any other principals - Director fit and proper declarations and the firm's financial position ## Where Merrin fits Merrin supports oversight of a broker and introducer network. Your team can follow each firm’s scope, risk, outstanding work and review history alongside its broker relationship records. ### Keep your existing systems Loan origination, underwriting, affordability checks, servicing and collections stay with your lending systems. Merrin does not operate the loan book. Complaint case handling and wider financial modules are planned. Lending-system integrations need to be agreed separately. [See the roadmap](https://merrin.ai/changelog) This is principal oversight of ARs and IARs, rather than a lending platform. ## Questions from credit broking & lending principals - Can an appointed representative lend money? Only interest-free credit with no other charges. Entering into a regulated credit agreement as lender is AR business only on that basis. Interest-bearing lending needs the lender's own permission. - Can an AR carry on debt counselling or debt adjusting? Yes, both are activities an AR can carry on. A principal must take all reasonable steps to make sure an AR acting as a debt packager takes no referral fees from debt solution providers (CONC 8.3.11R and 8.3.16R, in force since 2 October 2023). - What can an Introducer AR do in credit broking? Only introduce customers to the principal or its group and distribute non-real-time promotions. It cannot arrange regulated mortgage contracts, including second charge loans, or advise on credit secured on land. The FCA expects principals to check that IARs stay within that scope. - Can a credit broker AR work for more than one principal? Yes for consumer credit broking, which is not on the single-principal list in SUP 12.5.6AR. The restriction does apply to regulated mortgage activities, including second charge, and to MCD credit intermediation. The contract must require the AR to tell you about other appointments. - Is the AR regime about to change? HM Treasury consulted in February 2026 on requiring FCA permission to act as a principal (existing principals would be treated as holding it), giving the Financial Ombudsman jurisdiction over ARs where the principal is not responsible, and bringing ARs into SM&CR. The consultation closed on 9 April 2026\. As of October 2026 the government is analysing the feedback and no response or timetable has been published. ## Sources Checked against these sources on 23 October 2026. This is general information, not legal advice. - [FCA: Appointed representatives data (June 2026)](https://www.fca.org.uk/data/appointed-representatives-data) - [FCA: Principal firms with credit broking permissions (April 2024)](https://www.fca.org.uk/publications/good-and-poor-practice/principal-firms-credit-broking-permissions-good-and-poor-practice-areas-improvements) - [FCA: Multi-firm review of consumer credit firms and non-bank mortgage lenders (October 2024)](https://www.fca.org.uk/publications/multi-firm-reviews/multi-firm-review-consumer-credit-firms-non-bank-mortgage-lenders) - [FCA: PS23/5 Debt packagers](https://www.fca.org.uk/publications/policy-statements/ps23-5-debt-packagers-feedback-cp23-5-final-rules) - [FCA: Regulatory guide for credit brokers](https://www.fca.org.uk/firms/regulatory-guide-credit-brokers) - [FCA: Improving the AR regime through greater use of data (September 2023)](https://www.fca.org.uk/data/improving-appointed-representatives-regime-through-greater-use-data) - [HM Treasury: Consultation on the Appointed Representatives regime (February 2026)](https://www.gov.uk/government/consultations/consultation-the-appointed-representatives-regime) - [FCA Handbook, SUP 12](https://www.handbook.fca.org.uk/handbook/SUP/12/) ## Built for AR networks Choose your sector to see where Merrin helps with AR oversight. [Consumer creditMotor dealers and retailers. Our initial focus](https://merrin.ai/industries/consumer-credit)[Credit broking & lendingBroker and introducer networks](https://merrin.ai/industries/credit-broking)[Mortgages & protectionMortgage networks and their brokers](https://merrin.ai/industries/mortgages)[Financial adviceAdvice networks and wealth firms](https://merrin.ai/industries/financial-advice)[General insuranceInsurers and brokers with AR outlets](https://merrin.ai/industries/general-insurance)[Investment & regulatory hostingHosts, host AIFMs and investment principals](https://merrin.ai/industries/investments) ## See what your team could stop doing by hand Walk through onboarding, monitoring and reviews with your own oversight process in mind. [Schedule a demo ](https://merrin.ai/demo)