A firm may describe itself as a credit broker, an introducer or a lead generator. The FCA will be more interested in what happens after a customer clicks, calls or hands over their details.

That distinction matters because an introduction can be a regulated activity. So can passing a consumer to another broker, presenting a credit agreement or helping with preparatory work. A softer commercial label does not soften the perimeter.

For firms designing distribution arrangements, onboarding introducers or buying leads, the right question is not: 'What do we call this relationship?' It is: 'What regulated activity, if any, is being carried on at each step, by whom, and under whose responsibility?'

This comparison complements our guide to credit-broking permissions, focusing on the boundaries between these three commercial descriptions.

Start with the activity, not the job title

Under Article 36A of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, credit broking covers more than negotiating a loan. The FCA identifies six forms: introducing an individual seeking credit to a lender; introducing an individual seeking consumer hire to an owner; introducing an individual to another credit broker; presenting or offering a credit agreement; undertaking preparatory work; and entering a credit agreement on a lender's behalf. The detailed conditions and exclusions still need to be checked.

The introduction activities are particularly important for referral models. A warm handover, a web form that sends an applicant to a lender, or the transfer of contact details to a broker may all sit within credit broking. The fact that the introducer never recommends a product or completes the loan does not, by itself, settle the question.

If a regulated activity is carried on by way of business in the UK, the general prohibition in section 19 of the Financial Services and Markets Act 2000 means the person must be authorised or exempt. Acting outside the scope of an existing permission is also a serious issue. The perimeter analysis therefore comes before the marketing label.

What is a credit broker?

'Credit broker' is the term tied most directly to the regulated activity. It can cover a business whose main purpose is matching customers with lenders, but it can also cover a retailer or service provider arranging finance alongside its main sale.

This is why two firms doing apparently similar handoffs can have different regulatory routes. A primary broker whose main business is introducing customers to lenders or other brokers will ordinarily require Full Permission if directly authorised. A motor dealer, dentist, gym or other secondary broker may be eligible for Limited Permission where its credit broking is ancillary to selling its own goods or services and the relevant conditions are met.

Limited Permission is not shorthand for 'we only introduce'. The FCA's current authorisation guidance says that introducing customers to lenders or brokers as a main business activity is a common reason a firm is Full Permission instead. The full facts, products and activities must be tested.

What is an introducer?

'Introducer' describes what a business does, not a universal exemption. If the introduction is made with a view to an individual entering into a relevant credit or consumer hire agreement, it may itself be credit broking.

An introducer may be directly authorised. It may act as an appointed representative (AR) of an authorised principal. Or, where the model is genuinely narrow, it may be an introducer appointed representative (IAR). An IAR's appointment is limited to making introductions to its principal or members of the principal's group and distributing non-real-time financial promotions relating to products or services available from or through that principal or group.

That boundary is operational, not cosmetic. If an IAR starts comparing products, steering a customer towards a particular agreement, conducting a substantive fact-find, negotiating terms, preparing the application or behaving in a way that leads the customer to think advice has been given, the activity may have moved beyond the agreed IAR scope. The contract, training, scripts, technology and monitoring should all reflect the actual boundary.

What is a lead generator?

A lead generator usually attracts prospective customers, collects data and passes or sells the lead to a lender or broker. That is a commercial model, not a separate regulated category.

In consumer credit, lead generation can be a form of credit broking. The FCA's newer credit-broking reporting framework reinforces the point: for firms undertaking lead-generator activity, total introductions include customers whose contact details were passed to a lender or credit broker.

The regulatory risk often increases when the customer journey is designed to look like a direct application, a whole-of-market search or a personalised match when the lead is actually routed according to commercial arrangements. Firms should be able to explain who receives the lead, why, what the customer was told, what consent was obtained and how the outcome is monitored.

The practical difference

Authorised, AR or IAR: the route still matters

Once the activities are mapped, the firm needs the right legal route for carrying them on.

• Direct authorisation: the firm holds its own FCA permission. The scope must cover every regulated activity it actually performs, and the Limited Permission or Full Permission analysis must be correct.
• Appointed representative: the firm carries on agreed regulated activities under the responsibility of an authorised principal. The principal must have the relevant permissions, document the scope and provide ongoing oversight.
• Introducer appointed representative: a narrower AR category limited to introductions and non-real-time financial promotions within the appointment. It is not a convenient label for a broader sales process.
• Exclusion or exemption: some activities or agreements fall outside credit broking, but exclusions are specific and should be documented against the actual facts rather than assumed from the business description.

A 2026 point: deferred payment credit

Since 15 July 2026, the FCA's perimeter guidance states that activity is not credit broking insofar as it relates to a regulated deferred payment credit agreement. The FCA also says that a firm whose only credit-broking activity concerns those agreements does not need authorisation as a credit broker.

That is a product-specific exclusion, not a general pass for merchants, platforms or lead generators. A business that also introduces customers for hire purchase, personal loans, running-account credit or other finance must test those activities separately. Mixed journeys need a mixed-activity analysis.

Conduct rules do not stop at the handoff

Getting the perimeter right is only the start. A credit broker that is not a lender must ensure its financial promotions state prominently that it is a credit broker and not a lender. Promotions and customer communications must also use the firm's legal name as it appears on the Financial Services Register.

Before referring a customer to a third party, CONC requires consent after the firm has explained why the customer's details will be disclosed. Firms should make data use clear, provide a simple way to withdraw consent to processing and take reasonable steps not to pass personal data to a business carrying on credit-related regulated activity without the necessary permission.

For AR and IAR models, the principal must assess suitability, define the appointment and maintain appropriate oversight. The formal annual representative review under SUP 12.6A.2R applies to ARs other than IARs. IARs remain subject to the applicable ongoing controls and oversight requirements, and the principal's annual self-assessment covers IAR arrangements to the extent the rules apply. Websites, scripts, paid media, lead sources, complaints and customer outcomes should inform proportionate monitoring.

Seven questions to test your model

1. What exactly happens from the first advert or enquiry to the lender or broker handoff?
2. Who selects the recipient, and is the selection driven by customer needs, panel rules, price or commission?
3. Does anyone compare, recommend, explain, negotiate, pre-fill or submit?
4. Which credit or hire products are involved, and do any specific exclusions apply?
5. What permission, AR appointment or IAR appointment covers each step?
6. Do promotions, disclosures and consent wording match what actually happens to the lead?
7. What management information shows whether customers receive good outcomes and representatives stay within scope?

The regulatory difference is in the evidence

A credit broker, introducer and lead generator may be three different businesses. They may also be three descriptions of substantially the same regulated activity.

The defensible answer sits in the evidence: the customer journey, permissions, contracts, scripts, promotions, data flows, remuneration, monitoring and outcomes. Firms that map those elements before launching or changing a distribution model are less likely to discover, too late, that their tidy commercial label concealed a perimeter problem.

Authorised Compliance helps credit brokers, lenders and principals assess permissions, structure introducer and AR arrangements, review promotions and build proportionate oversight that works in practice.

This article provides general information and is not legal advice. Whether an activity is regulated depends on the specific facts and applicable law and FCA rules.