Monday, 13 November 2017 12:36

FCA may charge £100 a year for paper fee invoices

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The FCA has issued a Consultation Paper today outlining a proposal to potentially charge firms up to £100 year for paper fee invoices.

The regulator says that there is a cost to sending out paper invoices and this needs to be covered. It believes a charge of £50 to £100 a year could be made although it points out that only a minority of firms - about 15% of the total or 8,000 firms - still receive paper invoices, with most opting for electronic delivery.

The watchdog says that subject to feedback, it would expect to consult on any new rules next year.

In CP17/ 38 the FCA says that online invoicing is more environmentally friendly and “enhances the efficiency of our fee invoicing and collection process by eliminating paper.”

The number of fee-payers has more than doubled since 2014, it says, and its web-based invoicing
application has enabled it to invoice the 30,000 new fee-payers (since it became responsible for consumer credit regulation) and absorb the increased work without a proportionate increase in resources and costs.

At present about 85% of authorised firms are registered and using online invoicing, leaving about 8,000 receiving paper invoices.

It is encouraging all firms to register for online invoicing and most new joiners are automatically set up with access to the online
system.

Only a small number of firms have opted out and requested paper invoices, it says, and “the vast majority of firms use online invoicing because they find it easier and more convenient than paper invoicing.”

The FCA says: “Printing and distributing 8,000 invoices as well as the associated paper and postage costs is expensive and time-consuming.

“In addition, firms which are not online receive other fees correspondence by post, including reminder letters for non-payment of fees and credit notes, further increasing our costs and making us less efficient as we need to manually record these.”

The additional costs are borne by the whole body of fee-payers, says the FCA.

“We believe that firms wishing to preserve this manual service should pay for it, rather than expecting other firms to share the costs. We estimate that a charge of £50 to £100 per year would cover our costs, but we will review the figures before consulting formally next
year,” the FCA states.

The charge is likely to increase in the future as the number of firms receiving paper invoices declines and any economies of scale are eroded.

 

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