The Financial Conduct Authority (FCA) in many ways is the most innovative regulatory body in the world today. Yes, I know. It can be hard for some people to see the word “Regulation” next to “Innovation” when referencing a government agency. But the proof is in the ecosystem and alternative finance markets that have been engendered in the UK. Fintech innovation has been a policy priority in not just words, but actions. From launching the very first peer to peer lending platform to creating the most robust equity crowdfunding sector in the world, the UK has shouldered the risk and trailblazed a path for others to follow. So what is next on the list for the Brits to tackle? RegTech is getting some attention and the FCA wants to disrupt itself by providing more competition and better services for consumers.
During the first half of 2015, the FCA commenced a review of regulatory requirements and technology to attempt to decipher how these two catalysts could join together in RegTech. In part, this was demanded to fuel advancement of Fintech innovation. The below report provides a summary of the most important themes from feedback received regarding the FCA approach to the future of RegTech.
Over 350 interested parties participated in the request for comments. Both established financial firms and disruptive innovators added their voice to the document. The FCA believes an important element of their role is as follows;
“Our ambition is to be a regulator that is fully engaged with the FinTech community and keen to improve the interface between the regulator and the regulated. To do this we intend to actively encourage and support the development and use of innovative technology, acting as a catalyst for further innovation within the FinTech sector, while remaining cognisant of the restrictions of our role as the regulator.”
Changing securities regulations and affiliated markets will always be more marathon than sprint. The fact that FCA leadership is approaching RegTech at all is impressive.
See the document below.
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