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Helping Patients could land you in Hot Water!
Make sure you are legal
It`s difficult to say this, but many dentists are breaking the law without even knowing it. Sometimes, we want to help people out by making payment easier. You know, the young person wanting a nice crown or an older person who can`t afford new dentures in one go. So we allow them to pay over a period of time. Another side of good business practice is to make finance available through a third party so that the `take-up` of big treatment plans is increased. In both these cases we are now breaking the law, unless we are very careful.
It is a criminal offence under the Consumer Credit Act 1974 to provide goods and services on credit or for hire, lend money or provide debt adjusting services to consumers without a credit licence. The maximum fine for this is £50,000. The particular activities that are likely to be relevant to a normal dental practice are –
- allow your customers time to pay for goods and/or services that they buy from you
- hire or lease out goods and/or services for more than three months
- introduce buyers to someone else who will lend them money
There are some exceptions to this, so in terms of allowing patients to pay over a period, there should be no interest added, the instalments should be four or fewer and the period should be less than a year. However, introducing a patient to a finance company will still require a licence.
Consumer credit regulation is changing
The regulation of consumer credit will transfer from the OFT to the Financial Conduct Authority (FCA) on 1 April 2014. This is part of the Government's programme of regulatory changes for financial services. That means from September 2013 you will need to register with the FCA, or you will not be able to carry on the activities described above.
Log on to the Office of Fair Trading website (which is still giving the up to date information) and download their advice and information on credit licenses. Remember that it is a criminal offence to operate without one and that could affect you GDC registration.
Dr John Shapter – QCS Expert Dental Contributor