The United Kingdom’s financial market regulator will establish a ‘regulatory nursery’ to closely oversee the newly authorized financial services companies, which was revealed by FCA Chief Nikhil Rathi in a speech while speaking at FinTech Week.
“Currently, firms gain regulatory status and are treated in the same way as a firm with a long track record. The regulatory nursery will keep us in close contact with firms immediately post-authorization so we can provide support and, where we need to, intervene earlier to steer firms in the right direction,” Rathi said.
Making UK a Fintech Hub
These steps are being taken in line with the recommendations made by Ron Kalifa, former CEO of payments fintech, Worldpay, in a recent blueprint to scale the country’s fintech industry.
In addition, Rathi said that the FCA will start allowing the year-round applications for the Sandbox, which currently is a quarterly proposition. The agency will also better advertise its support for companies looking to build innovative products.
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“We will help connect scaling entities with our international peers, through the Global Financial Innovation Network, which now includes over 60 organizations committed to supporting financial innovation in the interests of consumers,” the FCA Chief added.
“We will support scaling firms’ entry and growth in other markets and further develop cross-border testing of innovative products and services.”
Furthermore, the regulator partnered with the City of London Corporation to expand its Digital Sandbox program with a focus on sustainability. The FCA even appointed its first sustainability to lead and carry forward its ambitions.
Meanwhile, Rathi focused on the rising risks of fintech and pointed out the responsibilities of search and social media companies in connecting consumers with investment companies.