Is business lending regulated by the FCA?
Most business lending is not regulated by the FCA. Lending to a limited company falls outside the consumer credit regime entirely, and larger loans to sole traders and small partnerships are usually unregulated too. FCA consumer-credit protection mainly applies to individuals, sole traders and partnerships of two or three people borrowing under a regulated credit agreement, and there are exemptions even then. So whether your loan is FCA-regulated depends on who is borrowing and how the agreement is structured, not on the lender. The practical consequence is that a typical company loan does not come with consumer-credit rights such as Section 75 or the statutory cooling-off period, so the terms you sign matter more, not less.
Where the line falls
The Consumer Credit Act and the FCA's rules regulate credit to individuals and small unincorporated businesses, not to limited companies. Borrowing by a company is treated as a commercial transaction between businesses. Loans to sole traders and small partnerships can be regulated, but large-business exemptions and the structure of the agreement often take them outside the regime. This is why two businesses borrowing similar amounts can have very different protection depending purely on whether they trade through a company.
What it means for your protection
If your loan is unregulated, you generally do not get the consumer-credit safeguards: no automatic cooling-off period, no Section 75 joint liability, and disputes are a contractual matter rather than something the Financial Ombudsman Service will usually consider. That does not make unregulated lending unsafe, but it puts the weight on the contract. Read the facility letter, the default terms and any personal guarantee carefully, and take advice before signing.
Does the lender still have to behave?
A lender or broker can still be FCA-authorised for other activities, and many follow lending standards voluntarily, but that is not the same as your agreement being regulated. If transparency and recourse matter to you, ask the lender directly whether your specific agreement is a regulated credit agreement and what complaints route applies.
Frequently asked questions
Is a loan to a limited company regulated by the FCA?
Generally no. Lending to a limited company falls outside the consumer credit regime entirely and is treated as a commercial transaction between businesses, so it does not carry consumer-credit protections such as Section 75 or a statutory cooling-off period.
Which business borrowers do get FCA consumer-credit protection?
Consumer-credit protection mainly applies to individuals, sole traders and small partnerships of two or three people borrowing under a regulated credit agreement. Even then there are exemptions, and large-business exemptions often take bigger loans outside the regime.
What protection do I lose if my business loan is unregulated?
If your agreement is unregulated you generally do not get the consumer-credit safeguards: no automatic cooling-off period, no Section 75 joint liability, and disputes are a contractual matter rather than something the Financial Ombudsman Service will usually consider. The weight falls on the contract you sign.
If the lender is FCA-authorised, is my loan automatically regulated?
No. A lender or broker can be FCA-authorised for other activities while your specific agreement is still unregulated. Whether your loan is a regulated credit agreement depends on who is borrowing and how the agreement is structured, not on the lender's authorisation. Ask the lender directly about your specific agreement.
This is general information, not legal or financial advice. The regulatory position of any specific agreement depends on the borrower, the amount and the structure under the Consumer Credit Act 1974 and the FCA's rules. Confirm the status of your own agreement with the lender or an adviser. Last reviewed June 2026.