PART 3PAYMENTS DISTRIBUTORS

Payments distributors for a debt payment programme13

1

An approved payments distributor whose name and address is specified in accordance with section 2(3)(c) of the Act is to act as the payments distributor for a particular debt payment programme if the DAS Administrator consents to that appointment.

2

If the DAS Administrator does not so consent, the DAS Administrator must arrange for another approved payments distributor to act as payments distributor.

3

In exercising its functions under this regulation, the DAS Administrator must have regard to the outcome of the tendering process under regulation 14(2).

Approval of a payments distributor14

1

An application to the DAS Administrator for approval as a payments distributor must be in writing.

2

The DAS Administrator must invite tenders for persons or bodies to be approved as payments distributors by a fair, open and transparent tendering process.

3

The DAS Administrator must approve an application under paragraph (1) if—

a

satisfied that the applicant is a fit and proper person or body to be a payments distributor; and

b

the applicant is appointed following the tender process under paragraph (2).

4

Without prejudice to the generality of paragraph (3)(a), an applicant is not a fit and proper person if the person or body does not satisfy the criteria specified in Schedule 4.

5

The DAS Administrator may make approval under paragraph (3) subject to any reasonable condition.

6

Approval is for any period stated in that approval (or in the tendering process under paragraph (2)).

Revocation of approval of a payments distributor15

The DAS Administrator may revoke the approval of a payments distributor where—

a

the distributor fails without good reason to comply with a condition attached to the approval;

b

the DAS Administrator is satisfied that the distributor is no longer a fit and proper person to be a distributor; or

c

in the opinion of the DAS Administrator the distributor—

i

has failed without good cause to carry out a function of a distributor under the Act or under these Regulations; and

ii

continues to fail to carry out that function, after 2 weeks from the date of written notice to the distributor of that failure;

d

in the opinion of the DAS Administrator the distributor fails to comply without good reason with any condition to which the approval is subject under regulation 14(5).

Functions and duty of a payments distributor16

1

It is a function of a payments distributor—

a

to assist the DAS Administrator and any continuing money adviser with, and advise on, payments distribution;

b

to distribute sums received in accordance with the debt payment programme;

c

to provide payment and distribution reports to the DAS Administrator, any continuing money adviser, and to creditors;

d

to provide information to the DAS Administrator about the exercise of a function of a payments distributor; and

e

to remit the fee payable in accordance with regulation 5 to the DAS Administrator.

2

On an approval being revoked under regulation 15 or a distributor otherwise ceasing to act, the distributor whose approval is revoked, or who ceases to act, must transfer to a substitute payments distributor specified by the DAS Administrator the debt payment programmes for which that first distributor is responsible, within a reasonable period specified by the DAS Administrator.

3

A payments distributor must have regard to guidance issued by the DAS Administrator when carrying out a function of a distributor.

Charges by a payments distributor17

1

In the exercise of a function under the Act or these Regulations, a payments distributor—

a

must make no charge of any kind to a debtor for payments distribution; and

b

subject to paragraph (2), may charge an administration fee to a creditor taking part in a debt payment programme.

2

The administration fee must be no more than 8% of the sum due to be paid to a creditor in a distribution by the distributor.