The FCA will boost growth by being a smarter regulator
The Financial Conduct Authority is prioritising growth and fighting financial crime as chief executive Nikhil Rathi unveils a new five-year strategy
Tomorrow the Chancellor will deliver her Spring Statement. Among the blizzard of figures, it’s likely we will hear one word more than any other: growth.
The government has made growth their number one mission. And growth matters. Without it, there is less money for public services and less in people’s pockets. Living standards won’t rise.
At the Financial Conduct Authority (FCA), our work has long contributed to growth by enabling trusted, liquid markets, boosting competition, reducing financial crime and ensuring consumers can confidently engage with products they need. In the last year alone, we have delivered reforms to strengthen the UK’s wholesale markets and make it easier for businesses to attract investment.
And we are going much further. We recently set out to the Prime Minister almost 50 measures we will take forward to support long-term, sustained growth. Initiatives to unlock more capital for businesses, accelerate innovation, reduce regulatory burdens, enable more firms to start-up and grow, boost exports of financial services and provide greater certainty and predictability to support business confidence and secure overseas investment.
Today, we have confirmed that supporting growth will be one of four priorities in our new five-year strategy, along with helping consumers, fighting crime and becoming a smarter regulator.
Consumers must make often complex financial decisions. We will help them navigate their financial lives by ensuring they get the right information and support. Our ground-breaking consumer duty, which sets a higher standard of consumer protection, already means firms have to act to deliver good outcomes for their customers. We will enable more people to benefit from financial guidance, so they can make the most of their pensions and invest with greater confidence. And we will drive better value for money in workplace pensions, encouraging schemes to invest for longer-term returns, boosting individual nest eggs and economic growth.
Fighting financial crime
We have made good progress in the collective fight against financial crime which is a drain on growth and damages consumer confidence. Over the last two years, we’ve charged more people with criminal offences than ever before and reduced our investigation times. We are harnessing technology to better identify scams and stop them sooner. We are tackling misleading financial promotions at scale. With partners, we’ve slowed the growth in investment fraud and we will go further to disrupt crime. We will better support the firms we regulate to be an effective line of defence. And our new Firm Checker tool will help consumers easily check they are using an authorised firm and avoid scams.
The way we operate can clear the way to greater innovation and investment. We’re more quickly authorising firms that meet our high standards. And we’ll continue to work smarter, investing in our technology, people and systems.
Success on one priority spurs success on the others. Becoming a more efficient and effective regulator helps us fight crime. That builds people’s trust, giving them the confidence to take informed risks so they can better withstand a financial shock or save for retirement.
Those savings can be turned into capital for businesses to invest and expand which then supports growth.
We will deliver at a pace that matches the urgency of the UK’s economic challenges. Since I wrote to the Prime Minister in January, we’ve already taken steps to help get more people on the housing ladder and opened a debate on whether we should remove the £100 contactless limit to make payments easier and spur innovation. And today we’re announcing ways we will simplify our rules to remove burdens on firms, while maintaining high standards.
By embracing the push for growth, we aren’t walking away from our primary objectives of protecting consumers, safeguarding market integrity and promoting competition. We can and will fulfil each, and by continually challenging ourselves on whether we are getting the balance right, go even further to improve lives.
Nikhil Rathi is the chief executive of the Financial Conduct Authority