FCA puts focus on innovation, technology and more assertive approach

Speaking on the Financial Conduct Authority’s Our Role and Business Plan webinar, Nikhil Rathi, CEO at the FCA, said the regulator must become a “a forward-looking, proactive regulator” as it seeks to deal with what he called the “profound forces” that were reshaping financial services.

Rathi said the pandemic had driven a rise in consumer vulnerability while other forces included ongoing changes in technology, the transition to a net zero economy and the regulatory overhaul needed as a result of Brexit.

Outlining how the regulator would meet these challenges, he said: “First, continuing to be more innovative – taking advantage of data and technology to increase our ability to act decisively.

“Second, continuing to be more assertive – testing the limits of our powers and supporting others to bring their powers to bear.

“Third, continuing to be more adaptive – constantly learning and always adjusting our approach as consumer choices, markets, services and products evolve. And underpinning it all will be a regime of accountability and culture of transparency.”

Rathi said the FCA will invest £120m into its data and technological capabilities over the next 3 years.

He said the days of light-touch regulation would remain in the past and that there was no scenario that would prompt a return to this approach.

He added: “Firms should expect us to be even more rigorous on upholding high standards – especially on governance, conflicts of interest and conduct, including considering diversity and inclusion as regulatory issues, as we set out last week with our colleagues at the Bank of England.”

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