Consumers
How are building societies regulated?
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The main legislation governing the sector is the Building Societies Act 1986 (amended in 1997) which requires building societies to have as their main business making residential mortgage loans funded by the savings of members, and describes how they are to be regulated in order to ensure that members' money is safe. Each society has a set of rules that governs the relationship between the society and its members.
Building societies are also covered by the Banking Conduct of Business Sourcebook and Payment Services Regulations 2009 (enforced by the Financial Services Authority) and, if appropriate, the voluntary Lending Code (enforced by the Lending Standards Board) which sets standards of good practice in relation to loans, credit cards, charge cards and current account overdrafts.
Building societies are regulated by the Financial Services Authority (FSA), under the Financial Services and Markets Act 2000. The role of the regulator is to ensure societies are run in a safe and prudent manner.
Links:
Link to the FInancial Services Authority
Link to the Lending Standards Board
Summary of the Building Societies Act 1986
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