Jersey's consumer credit regime: An update

On 31 March 2026 the Government of Jersey launched a consultation on the secondary legislation proposed to support Jersey's consumer credit regime. The Financial Services (Jersey) (Amendment) Law 2025, which was adopted by the States Assembly in July 2025 and received Privy Council approval in November 2025 amends the Financial Services (Jersey) Law 1998 (FSJL) to introduce enhanced protections for consumers while establishing a proportionate approach for industry. The changes were summarised previously in our earlier briefing, which can be found here.

We previously explained the regime will be supported by secondary legislation, which will look to introduce a 'two tier approach' to regulation. A central component of the draft secondary legislation is the Draft Financial Services (Wider Consumer Credit Business) (Jersey) Regulations 202- (Wider Consumer Credit Regulations). The Wider Consumer Credit Regulations are effectively the previously anticipated "unfair terms regulations" and set out detailed conduct of business standards that apply to lenders and providers engaged in wider consumer credit activities. They form part of a broader package of secondary legislation currently subject to the consultation, which closes on 29 May 2026. 

The two-tier regulatory approach

Jersey's new consumer credit regime will adopt a two-tier model to differentiate regulatory oversight according to the nature and risk profile of the activities:

Tier 1 – Authorised lenders: activities such as providing or arranging consumer credit, credit broking, or advising on credit, will require authorisation and ongoing supervision by the Jersey Financial Services Commission (JFSC) under the newly amended FSJL (unless an exemption applies). 

These firms will also be required to comply with a new, forthcoming JFSC Code of Practice (which will be subject to separate consultation) as well as supervision by Trading Standards via the draft Wider Consumer Credit Regulations.  

Tier 2 – Wider / exempt activities: activities that will not trigger registration and authorisation under the FSJL will, nevertheless, fall under the oversight of Trading Standards. The draft Wider Consumer Credit Regulations will apply to "consumer credit business" (as defined in the revised FSJL) including an activity that would otherwise be consumer credit business but for an exemption.

The Wider Consumer Credit Regulations aim to establish a consistent baseline of consumer protections that apply across both tiers, ensuring uniformity in key areas regardless of whether the provider of credit is subject to prudential regulation and supervision. 

Exclusions from Tier 2?

The consultation notes that some activities, which will be exempt from registration under the FSJL, are proposed to also be excluded from the more basic protections of the Wider Consumer Credit Regulations, including 'buy now pay later' arrangements, activities of certain overseas persons or where activities are undertaken in relation to a high net worth individual, provided such individual has opted out of the protections. These activities (and others) will be completely out of scope of the new regime. Feedback is sought on whether this approach is clear and proportionate.

Key features of tier 2 protections

The draft Wider Consumer Credit Business Regulations broadly seek to operationalise the principles set out in the changes to the primary legislation by specifying clear, enforceable requirements for consumer credit service providers and lenders. Key features include:

Fairness of terms and conditions

Providers of credit must ensure that all terms and conditions in consumer credit agreements are fair. There are two schedules to the Wider Consumer Credit Regulations: one listing terms that are always unfair (for example, those excluding liability for death or personal injury caused by negligence) and another identifying terms that may be unfair (such as unreasonable cancellation charges or unilateral variation clauses without adequate notice). 

Unfair terms are unenforceable, and the burden of proving fairness will sit with the credit provider, if challenged. 

Pre-contractual disclosures

Before entering into an agreement, providers must supply borrowers with clear information in writing including details such as the amount advanced, repayment schedule, Annual Percentage Rate (APR), Total Cost of Credit (TCC), applicable fees and charges, risks, cancellation rights, and the complaints procedure.

The consultation paper notes that all lenders will be required to calculate APR and TCC in the same way, meaning that results are consistent and comparable for consumers. The formula will be clearly set out in a Notice issued by Government and will replicate the formulas used in the UK and Guernsey to ensure products remain available to consumers.

Responsible lending requirements

Providers of credit are required to undertake assessments of the borrower’s vulnerability, creditworthiness, and ability to afford repayments prior to granting credit or providing advice. Where advice is given, an additional assessment of suitability must be conducted, taking into account the borrower’s circumstances and the characteristics of the product.

Advertising standards

Advertisements for consumer credit must include prominent disclosure of the representative APR and information on the cost of credit. They must not be misleading, must clearly identify the advertiser and provider, and are subject to restrictions on unsolicited communications.

Borrower protections and rights

The regulations will, if brought into force, introduce a seven-day reflection period before entering secured lending arrangements and a 14-day cooling-off period during which most agreements may be cancelled without reason (subject to specified exceptions and repayment rules for any goods or services already received). Providers must also maintain formal procedures for handling and resolving complaints within defined timelines.

Offences?

The draft Wider Consumer Credit Regulations set out offences that may be committed and enforcement powers available to Trading Standards where a breach of the regulations has occurred. Offences include:

• Using unfair terms 
• Failure to disclose relevant information 
• Improper advertising 
• Failure to maintain complaints procedures 

Defences to offences include due diligence, and innocent publication for publishers. It is proposed that the penalty for an offence is a level 3 fine on the standard scale and that the Chief Trading Standards Officer may accept undertakings from businesses not to carry out a further breach and/or publish enforcement actions.

Debt collection regulations

The package of secondary legislation being consulted upon includes the draft Financial Services (Consumer Credit Debt Collection) (Jersey) Regulations 202- (Debt Collection Regulations), which introduce statutory conduct requirements for debt collectors. These focus on requirements for clear and non-aggressive communication, accurate information, dispute resolution, complaints handling and enforcement, strengthening protections for borrowers experiencing financial difficulty. 

Debt collection for consumer credit does not fall within the supervisory perimeter of the JFSC; it remains within the remit of Trading Standards. There will be no exemptions for compliance with the Debt Collection Regulations.

Alignment with policy objectives

The draft regulations seek to address concerns regarding the use of consumer credit in Jersey, including issues of affordability, transparency of charges, contract clarity, and debt collection practices. By embedding requirements for responsible lending, clear information, and fair treatment, they help deliver the consumer protections envisaged by the amendments to the primary legislation, whist maintaining a balanced framework that supports legitimate lending activity. 

Proposed implementation timeline

Feedback from industry on the proposed secondary legislation is invited before the consultation closes on 29 May 2026.  Thereafter, the intention is to lodge the final package for States debate in September. A separate consultation on the JFSC’s Consumer Credit Business Code of Practice is planned for the second half of this year. The regime is expected to commence in late 2026 or early 2027, with a 12-month transitional period to allow industry to adapt. 

What next?

Once feedback has been received and the draft secondary legislation is at a more settled stage, lenders and providers of credit should consider a review of customer facing documentation governing lending arrangements to ensure compliance with the new regime. 

Do get in touch with your Walkers Regulatory & Risk Advisory team in Jersey should you wish to discuss further.