FCA rolls out five-year strategy to facilitate growth and rebalance risk

With this new strategy, the FCA seeks to deepen trust in financial services across the UK and shift its focus on maintaining advancement in the industry. Commenting on the news, representatives from the FCA mentioned that the last strategy set the standards and boosted operational effectiveness. Currently, the regulator is committed to providing at pace to meet the changes that the sector is facing. Additionally, the FCA seeks to collaborate with its partners to achieve its objectives.

The FCA’s plans

As part of the five-year strategy, the regulator intends to prioritise four matters, including optimising its processes and taking a more technological approach to become more efficient, assisting in sustained economic growth by allowing investment and ensuring the competitiveness of the UK’s financial services sector, and supporting consumers in navigating their financial lives. The FCA aims to do this by collaborating with the industry to increase trust and product advancement and ensuring the right information and support can be accessed by people to make financial decisions. Additionally, the regulator aims to centre its efforts on mitigating financial crime, concentrating on those who intend to leverage the fact they are regulated to do harmful activities. It intends to move forward with its plans to disrupt criminals and assist companies in maintaining their defences against fraud.

Furthermore, through this strategy, the FCA plans to modify how it supervises to become more efficient, including taking a less rigorous approach for those companies aiming to conduct their operations according to the law, substantially optimising how it sets its supervisory priorities, and reviewing whether it can stop requiring certain data returns. It seeks to digitise the authorisation process so that it simplifies applications, the information offered is more qualitative, and follow-up requests are minimised. At the same time, the regulator looks into investing in its technology, team, and systems.

According to a statement provided by Charlotte Crosswell OBE, Chair of Centre for Finance, Innovation and Technology (CFIT), to The Paypers, the FCA’s strategy has been welcomed by the industry, with the regulator now recognising the importance of Open Finance, as well as the wider smart data uprising it can unlock, for its priority to assist in economic growth.  Also, the FCA’s focus on small business lending to facilitate development falls in line with the proof of concept built by CFIT’s Open Finance coalition to optimise SME access to credit and the seven-step action plan published by the CFIT-chaired SME Finance Taskforce in 2024.