The Financial Conduct Authority (FCA) has launched a ‘call for input’ on its own rules with the aim of reducing paperwork and supporting economic growth.
The call for input will seek views on areas of the FCA’s rulebook which potentially undermine its new outcomes-focused regulatory approach.
The review effectively turns the concept of Consumer Duty back on the regulator, as it aims to improve processes and rules with the support of the end consumer in mind.
Tom Selby, director of public policy at AJ Bell, said: “A year on from the implementation of new Consumer Duty rules on most financial services firms, the FCA is examining its own rulebook, with the aim of stripping out any rules or guidance which create regulatory cost for no clear consumer benefit.
“This period of regulatory self-reflection is welcome, and provides an opportunity to ensure the rules and regulations imposed on firms across various financial services sectors are fit for purpose.
“The development of reforms to the advice guidance boundary, including the potential for more personalised guidance through ‘Targeted Support’, will require firms to be given flexibility to design guidance interventions based on their understanding of customer behaviour.
“The demands of the Consumer Duty on firms to aim for ‘good outcomes’ for customers should reduce the need for overly prescriptive rules. Instead, businesses will benefit from additional flexibility to deliver propositions that work for their customers, in line with the overarching objective of delivering good outcomes under Consumer Duty.”
