Do you need FCA authorisation to broker commercial finance?
For unregulated commercial finance brokered to limited companies, you do not need FCA authorisation. The line is set by borrower type and product: broking to sole traders, partnerships, or individuals, and regulated products such as residential mortgages, consumer credit, or Start Up Loans to individuals, can require FCA permission. Get the structure right from day one.
The single question that stops more aspiring commercial finance brokers than any other is this: do I need to be regulated? The honest answer is that it depends on who you lend to and what product you broker. For most business-to-business commercial finance placed with limited companies the answer is no, but the nuance matters, so it is worth setting out precisely.
The UK regulatory framework creates a genuine structural opportunity for brokers focused on limited companies. Broking unregulated commercial finance to limited-company borrowers falls outside the FCA's regulated-activities regime, which means no FCA authorisation and no appointed-representative arrangement for that work. CoreFi's platform is built around this model, helping brokers launch and trade in the unregulated space, while being clear about exactly where the boundary sits. Nothing here is legal advice; if your plans touch the edges below, take your own regulatory advice before trading.
The core rule: the limited company is the key
The Financial Services and Markets Act 2000 (FSMA) and the Regulated Activities Order 2001 (RAO) define which credit-related activities require FCA authorisation. The important point for commercial brokers is this: arranging or broking finance for a limited company for its business purposes generally falls outside the consumer-credit regulated activities, because a limited company is not an individual and the consumer-credit protections that trigger regulation are aimed at individuals.
In practice this means a broker whose client base is UK-registered limited companies, placing unregulated products such as business loans, invoice finance, asset finance, bridging, and commercial mortgages, can operate, place deals, and earn commission without FCA authorisation. That is CoreFi's model and a well-established way of working in the commercial finance market.
Where the line is drawn: sole traders, partnerships, and individuals
The position does not extend to every business borrower. If you broker finance to sole traders or small partnerships, it becomes more complicated. Under Article 36A(4) of the RAO, arranging a credit agreement can be a regulated activity where the borrower is an individual or a small partnership acting for business purposes, even for a loan that would otherwise be an exempt business agreement.
In plain terms: a sole trader applying for a business loan is still an individual in the eyes of the law, and arranging that finance can require FCA permission depending on the product, the structure, and the amount. If you intend to serve sole traders or partnerships, take specific regulatory advice on your exact activities before you trade. CoreFi's current model focuses on limited-company borrowers to keep that boundary clean.
Regulated products always require FCA permission
Borrower type aside, certain products are regulated regardless of who is borrowing. These include:
- Residential mortgages (first and second charge), including lending secured on a borrower's own home - Consumer credit products such as personal loans, hire purchase to individuals, and credit cards - Start Up Loans of up to 25,000 pounds made to individuals, which are personal loans backed by the British Business Bank and are regulated consumer credit
None of these can be introduced or arranged without the appropriate FCA permission or a valid appointed-representative arrangement with an authorised firm. If a prospective client asks about a Start Up Loan, the compliant response is to point them to the British Business Bank or an FCA-authorised firm, not to arrange it yourself. CoreFi's panel covers unregulated commercial products for limited companies, not these regulated products.
What about CeMAP or other qualifications?
CeMAP (Certificate in Mortgage Advice and Practice) is a qualification for residential mortgage advisers. It is not required for commercial finance broking, and holding it does not grant you any additional permissions for commercial products. There is no equivalent mandatory qualification for unregulated commercial finance broking in the UK at present.
Lenders will still assess your competence, just in other ways: your grasp of their credit criteria, your ability to package a deal correctly, and the quality of your submissions. CoreFi's training covers the practical knowledge lenders actually expect, rather than routing you through a qualification built for a different market.
Professional indemnity insurance: what the rules actually say
Professional indemnity (PI) insurance is not a legal requirement for unregulated business-to-business commercial finance broking. There is no statutory obligation under FSMA or the RAO, and no regulator imposes it on firms operating entirely outside the regulated perimeter.
Some lenders or introducer networks may ask whether you carry PI as part of their own due diligence, and you may choose to take it out as a matter of good business practice. But it is not a cost you must budget for to trade legally. CoreFi does not provide PI insurance, and does not present it as a legal requirement. Any broker who tells you PI is legally required for this market is overstating the position.
Being accurate about this keeps your compliance picture honest and stops you from overstating your obligations to clients or lenders.
Frequently asked questions
If I only broker to limited companies, do I need any FCA involvement at all?
For unregulated commercial finance placed with UK-registered limited companies (business loans, invoice finance, asset finance, bridging, commercial mortgages), you do not need FCA authorisation, an appointed-representative arrangement, or an FCA permission for that work. You trade as an ordinary limited company under standard company law. If you later take on regulated products or individual borrowers, that changes, so keep your activities inside the unregulated space unless you get authorised.
Can I broker to sole traders without FCA authorisation?
Not straightforwardly. Sole traders are individuals in the eyes of the RAO, and Article 36A(4) can bring some business-loan arrangements within the regulated perimeter. Before accepting sole-trader or partnership clients, take specific regulatory advice on the products you intend to place and how they are structured. CoreFi's current model focuses on limited-company borrowers to keep that boundary clear.
Are Start Up Loans something I can broker through CoreFi?
No. Start Up Loans of up to 25,000 pounds made to individuals are regulated consumer credit products administered via the British Business Bank. Broking or introducing them without FCA authorisation is not permitted. Refer enquiries to the British Business Bank or an FCA-authorised firm. CoreFi's panel covers unregulated commercial products for limited companies, not Start Up Loans.
What about commercial mortgages on investment or trading property?
Commercial mortgages on commercial property (offices, industrial units, retail premises, or property held in a limited company) are generally unregulated for limited-company borrowers. Residential mortgages, and second-charge lending secured on a borrower's own home, are regulated regardless of the stated purpose. If you are unsure whether a specific security type is regulated, treat it as regulated until you have confirmed otherwise with a legal or compliance adviser.
Do I need to register with the FCA at all, even if I am not authorised?
Not for unregulated commercial finance broking. You do not need to appear on the FCA Register, hold an FCA reference number, or notify the FCA of your business. You will, however, need to register with HMRC for anti-money-laundering supervision under the Money Laundering Regulations 2017 where that applies to your activity, which is a separate and much simpler process than FCA authorisation.
Launch a brokerage built on the right foundations
CoreFi's platform is designed for the unregulated commercial finance market: a panel of specialist lenders, a deal CRM, document handling, broker training, and a lender-matching engine. There is no franchise fee, where competitors often charge roughly 6,000 to 30,000 pounds, and you keep 55 to 70 percent of the lender commission and earn from your first deal. If you want to start with the regulatory picture clear, talk to the team.
Book a call with CoreFi