Coronavirus (COVID-19)—FCA chair discusses reshaping regulation to meet new challenges

Coronavirus (COVID-19)—FCA chair discusses reshaping regulation to meet new challenges

The Financial Conduct Authority (FCA) has published a speech by its chair, Charles Randell, in which he discussed the implications of the coronavirus (COVID-19) pandemic for UK financial regulation and how the FCA is adapting.

Randell outlined five key priorities as the FCA adapts to a changing financial landscape:

• focus on the gateway: the FCA must be rigorous with firms at the point when they apply, but if it does authorise them, it needs to know whether they are using their authorisation and what for; and quickly remove the authorisations of firms that are not using them or are misusing them

• focus on the basics: in consumer protection terms, that is safe and accessible payments; sustainable credit; clear and safe investment choices; and fair product terms

• focus on outcomes: firms must identify if consumers are trapped in a cycle of unaffordable debt and take action to break that cycle. If they do not, the FCA must be ready to take strong enforcement action against both the firm and the senior managers who are accountable for product design and consumer outcomes

• reshape regulation: Randell said the FCA was pushing the government to bring areas like online promotion and buy-now-pay-later into scope, but the FCA also needs to be more agile and confident in using its Principles for Businesses to take action against firms that are not doing the right thing. The FCA is giving consideration to a New Consumer Duty (or Duty of Care) and will make further announcements about this shortly

• reshape the FCA: Randell outlined some of the structural changes being made to adapt to the new post-Covid landscape, and said outcomes had to be measured and transparent

Source: Cautious optimism for the post-pandemic world

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