The Model Office Blog

The FCA 2019/20 Business Plan and RegTech

[fa icon="calendar"] Apr 26, 2019 12:36:58 PM / by Chris Davies

The FCA published its Business Plan 2019/20 on 17 April 2019, setting out 8 cross-sector priorities, as well as seven priorities for specific regulated sectors. The plan outlines the FCA’s priorities for the year ahead and describes its response to identified issues, covering supervisory priorities as well as market studies and the policy work the FCA plans to undertake through the course of the next 12 months.

The 8 cross-sector priorities are: 

1. EU Withdrawal and International engagement: The emphasis in last year’s plan on preparing for EU Withdrawal has reduced, replaced by a commitment by the FCA to redouble its international engagement efforts in order to retain its influence on global regulatory priorities

2. Firms’ culture and governance: With a principles based approach the FCA is focused on ensuring a constructive organisational culture to produce good customer outcomes. In essence this is encouraging self-regulation, something the SM&CR does and the good news is the FCA see RegTech as an integral part to this process. 

3. Operational resilience: As point 2 firms need to develop a 'security culture' to address key risks such as cyber risk so technology can ensure any threats and weaknesses are identified early and eradicated. 

4. Financial crime (fraud, scams) and AML: Fighting financial crime is a huge priority for the FCA and engaging with agencies and governmental bodies such as the Financial Action Task Force (FATF) to share intelligence is a key strategy. 

5. Fair treatment of existing customers: Firms should identify and manage vulnerable customers and ensure customer-facing staff have the correct training and competence requirements to encourage good outcomes

6. Innovation, data and data ethics: Firms are encouraged to adopt technology to help with good client outcomes and risk management. Obviously we would add, technology is an enabler tool to help the firm manage risk and should not be viewed as a panacea. 

7. Demographic change: Keep an eye out for a discussion paper on intergenerational challenges and you can also download our sister companies Great Wealth Transfer research paper for more. 

8. The future of regulation: The FCA is holding the mirror up to itself and this RegTech and a machine readable rule book is inevitable for the regulator to keep pace with the FinTech evolution. The future is all about ensuring firms have the right culture and truly place the client at the heart of its business 


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Topics: Financial regulation, Financial business development, fintech, regtech, Risk management, practice management, FCA, advice, HMT, suitability, FAWG, MiFIDII, SMCR, Data, GDPR, Chatbot, Culture, Enforcement, supervision, audit, Conduct, AI, Risk,, Accountability, Platforms, PROD, Product governance, digital,, Regulatory, Reporting

Chris Davies

Written by Chris Davies

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