For consumer credit businesses, the regulatory landscape has never been more challenging, with the full implementation of Buy Now Pay Later (BNPL) regulation in July 2026 and the continued implementation of the Consumer Duty frameworks. The cost of getting compliance wrong is now even more disastrous, as the FCA has been placing greater priority on consumer trust, which in turn could lead to supervisory action.
Because of this, many business owners across the UK are now questioning whether they need to build an internal compliance team or partner with an external specialist to manage and help them remain compliant.
However, whilst you may be considering whether you will need a compliance team or outsource your compliance. Under the Senior Managers and Certification Regime (SM&CR) in the FCA guidelines, you will still need to have a designated person who is legally responsible for the compliance of your business.
In this blog, we discuss the impact and the cost of having an internal compliance team and how partnering with a legal company, like ALPH Legal, could save you money and stress in the long term.
The financial cost of taking compliance in-house
A crucial mistake that many businesses make is equating the cost of a compliance officer with only their base salary. In the current compliance market, a Compliance Officer in the UK has an average salary between £60,000 and £80,000 per annum, whilst senior roles can often exceed £100,000. Although this is a substantial overhead for your business, the total cost of employment is significantly higher when you factor in the following additional expenses:
- National Insurance and Pensions: Employer contributions add approximately 15% to 20% to the base salary.
- Recruitment Fees: Compliance talent is hard to find, meaning recruitment agencies may charge between 15% and 25% of the first-year salary as a one-off finder’s fee.
- Training and Development: To remain compliant with the FCA requirements, staff must undergo continuous professional development (CPD) and specialised training on the new 2026 mandates.
- Infrastructure and Software: Every internal hire requires a desk, hardware, and access to expensive RegTech and Anti-Money Laundering (AML) screening tools.
When you combine these figures, a £70,000 contract can easily cost a business upwards of £95,000 in its first year. Furthermore, having only one person who is in charge of your compliance can be a significant risk, as if they were to leave or become unwell, your regulatory oversight effectively stops. Because of this, you may even need to consider hiring more than one person.
The benefit of outsourcing your compliance
Whilst you may look to employ an internal compliance officer for your business, they are likely only going to work with your specific product. Not only can this give them limited knowledge on the wider FCA requirements, but it could also lead to them missing crucial details, which could ultimately end with a regulatory review from the FCA.
When working with a specialist financial compliance law firm like ALPH Legal and Compliance, you are accessing years of collective experience that extends far beyond a single product or niche. This alone reduces your overheads and removes the vulnerability of relying on a single individual who may lack the necessary depth of knowledge.
Industry-wide benchmarking
Because our team operates across the entire consumer credit market, we have already seen how the FCA is applying the Consumer Duty frameworks and the 2026 BNPL mandates across many different business models. This allows us to identify gaps in your processes that an internal officer, focused only on your day-to-day operations, would likely overlook.
Professional accountability
Outside of the expertise you’d gain from working with our team, there is also accountability. When you hire an internal compliance person, the burden of their training, their mistakes, and their professional development sits entirely at your door. When working with ALPH Legal and Compliance, that burden shifts, as we are able to provide the finalised policies, monitoring programmes and any regulatory updates as a fixed service. This means that you reduce the time and money it takes to ensure your compliance team is fully trained and up-to-date, and that any mistakes won’t cause major issues for your business.
Objective oversight
If your business were to receive a visit from the FCA or undergo a section 166 review, having a third-party like ALPH Legal verify your compliance provides a layer of protection that an internal report can’t offer. Having this objective oversight demonstrates to the regulator that you have looked for professional and unbiased validation of your systems and controls, which is an important factor under the current duty of care standards.
The cost of outsourcing compliance
Whilst the upfront cost of a legal specialist may seem like a significant commitment, the reality is that it often provides far greater value than you’d get from an internal hire. Instead of budgeting around their wage and having the awkwardness of pay rise discussions coming up, you can move to a fixed fee structure that allows you to budget and control your cash flow more effectively.
Why use ALPH Legal and Compliance for your compliance needs
We understand that, for consumer credit businesses, navigating the FCA regulations and compliance is complex and overwhelming. It’s easy to think that hiring a compliance officer is beneficial to your business, but not only is it more expensive, but it also comes with a level of risk that can be hard to ignore.
When you work with our team at ALPH Legal and Compliance, you are accessing years of compliance expertise and experience that you can access. We will work with you and ensure that you are fully compliant, whether that’s getting authorised or navigating supervision. Our team is there to help your business function successfully.