Tim Chapman explores the regulatory measures introduced since the FCA’s inception, and explores the changes this will mean for the industry, as well as how Grovelands are responding.
Since its inception the FCA has built on the work of the FSA, causing the industry to stop and look closely at the central ethos that will keep the UK as a leading centre for the industry. Martin Wheatley’s latest speech on how regulations and sanctions will help spur growth in the UK market clearly laid down the ways in which regulations should be adopted by financial service providers in the UK.
To keep the market buoyant, regulated competition has been brought to the forefront to ensure a more customer centric vision for financial service providers to ensure better outcomes for all. One of the main focuses was making financial literature accessible and understandable to an ever diversifying customer base; ensuring customers do not ‘pore over terms and conditions that are longer than Hamlet’. This, however, cannot take place unless the FCA is successfully able to monitor competition over multi-platform financial models, where ‘complex pricing and products make it difficult to constrain suppliers’.
How can the financial services sector respond?
The main issue seems to be continuing an open dialogue between the FCA and suppliers. It is no longer feasible to remain a reactive mediator, and instead the FCA will promote forward thinking and proactive regulations that will ‘provide the prospect of early intervention’, rather than organising ‘clean-up’ bills. For example, the bill for PPI will now pass £10 billion and the obvious question here is “Would this scandal have taken place on such a scale if appropriate measures and regulations had been in place?”
What will be provided by the FCA, along with the government and asset managers, is a supportive and advisory structure to support the market itself, and a deeper level of accessibility and transparency on regulations in critical areas such as fund authorisation. This collaborative approach will also transfer over to the FCA working more closely with the IMA when providing advice and support.
What will this achieve?
A collaborative and equal market place will spur growth by fostering a customer focused and competitive industry, in which regulations will promote clearer financial models and, therefore, more transparent credit and fund terms for clients and customers. More stringent regulations will also hope to restore people’s trust in the financial services sector, and give customers the incentive to start investing back into the industry. A restored equilibrium is the desired end result.
What can Grovelands do?
We provide both a proactive and reactive service to accommodate the changing needs of compliance roles within the finance sector. We closely chart regulators so that we and our associates can adapt to the changing needs of the market. We also provide an open forum in which we can deliver associates into the sector who are informed and experienced, yet malleable, when providing compliance support to an ever shifting market.
We are always interested in your views on current financial affairs and beyond, so feel free to let us know your thoughts; whether over a coffee, by dropping into one of our offices, or by telephone. We want to hear from you.