U.K.’s Financial Conduct Authority (FCA) recently released its findings from a call for input it issued in its efforts to support the adoption of new technology and methods that better facilitate the delivery of regulatory requirements. The initiative has been dubbed RegTech. The goal is to help the financial sector better manage regulatory requirements and reduce compliance costs, thus enabling effective competition and innovation.
“Respondents thought that by clarifying our expectations and helping to drive industry standards and guidance, we would be helping to encourage improved effectiveness and efficiencies for both ourselves and the firms we regulate,” according to the report. “We are investigating how improved technology standards and guidance can be developed by proactively engaging with established financial services firms and standard-setting bodies.”
Responses from the financial services sector included creating more flexibility for companies by allowing them to use different software to provide data to the regulator, which would reduce some of the cost and burden of regulatory reporting. Respondents also suggested an online communication platform in which the FCA would take an active part to increase the financial sector’s understanding of regulations and compliance, as well as give the industry an opportunity to participate in the development of new policies.
The call for input received more than 350 responses from technology suppliers, financial services organizations and consultancies. With this feedback, the FCA said it intends “to concentrate our efforts on increasing our engagement and collaboration with the RegTech community, using our convening authority to help bring together market participants to work on shared challenges; and to act as a catalyst for change that helps to unlock the potential benefits of technology innovation.”
In other FCA news, CEO Andrew Bailey, previously the deputy governor at the Bank of England, replaced Tracey McDermott on July 1, as FCA’s leader and already is facing general criticisms that he won’t be as tough on financial misconduct as his predecessors who had more of an enforcement background. “The FCA, as you probably know, has just completed its first major insider dealing trial and it’s very important that these things happen. In terms of the overall cleanliness of the market, it’s very important,” Bailey told the Treasury Select Committee.
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