The FCA has announced an array of initiatives aimed at bolstering innovation and streamlining the regulatory process for emerging firms.
As part of its 2025-2026 work programme, the FCA is set to deploy smarter regulatory strategies that not only foster growth but also bolster consumer protection and crime prevention.
A cornerstone of the FCA’s new strategy involves the augmentation of its Regulatory Sandbox, which has been pivotal since its inception in 2016. To date, the sandbox has facilitated 195 firms in safely testing and deploying innovative products tailored for UK consumers. In this renewed framework, each participating firm will receive dedicated support from an authorisation case officer right from the outset, thereby enhancing the pace at which new products can reach the market.
Further broadening its supportive measures, the FCA has extended its pre-application support service to encompass wholesale, payments, and cryptoasset firms. This expansion is designed to attract more firms to the UK, stimulating growth, exports, and job creation while maintaining high regulatory standards. In the past year alone, the FCA’s proactive approach has assisted 80 wholesale firms through pre-application meetings.
Nikhil Rathi, chief executive of the FCA, emphasized the regulator’s commitment, stating, “We’re committed to being a smarter regulator – one that supports growth, helps consumers and fights crime. Our annual work programme details what we will deliver to achieve these goals. And today, we’re setting out how we’ll go further to help firms that want to join our markets with greater support for the application process and to test innovative products.”
In its pursuit to spearhead financial innovation, the FCA is introducing the Private Intermittent Securities and Capital Exchange System (PISCES), a new market enabling private companies to enhance their growth prospects and scale operations. This initiative will provide investors with increased access to lucrative investment opportunities in private markets.
Additionally, the FCA’s AI Lab will collaborate with firms to deepen the understanding and integration of AI solutions, which are poised to drive substantial growth and competitiveness within financial markets.
On the consumer front, the FCA plans to develop a new regulatory framework to ensure that financial advice, guidance, and help are more accessible and affordable. Moreover, the inclusion of Buy Now Pay Later (BNPL) products under the FCA’s regulatory umbrella aims to balance consumer protection with the encouragement of innovative financial solutions.
The FCA’s proactive stance extends to combating financial crime, with plans to implement a new data-led detection capability that will enhance the identification and mitigation of financial criminal activities.
As part of this comprehensive strategy, the FCA is also consulting on a proposal to increase its fees and levies by 2.5%, reflecting the escalation in ongoing regulatory activities.
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