FCA launches 5-year strategy to support growth and improve lives

On 25 March 2025, the Financial Conduct Authority (FCA) outlined its strategic vision for the period 2025-2030, focusing on deepening trust, rebalancing risk, supporting growth, and improving lives. This strategy aims to address the challenges and opportunities facing the financial services sector in the UK.

In summary, in our view, the direction of the FCA's strategy is not a surprise and is consistent with HMT's growth agenda. There are also some similarities with the strategy in the EU around the Savings and Investments Union. In essence, both the FCA and the EU Commission want to move more capital from retail savings into capital markets investments (the FCA specifies that it wants to see a higher proportion of consumers with over £10,000 in investment assets holding 'mainstream' investments). The FCA will be focussing on reducing fraud, improving innovation and improving financial information in order to support this shift.

It is notable that the FCA will be establishing a presence in the US and Asia-Pacific for the first time.

Four priorities

The FCA will focus on 4 priorities:

1. Be a smarter regulator; predictable, purposeful and proportionate. The FCA will improve its processes and embrace technology to become more efficient and effective.
2. Support sustained economic growth, by enabling investment, innovation and ensuring the continued competitiveness of the UK's world-leading financial services.
3. Help consumers navigate their financial lives by working with industry to boost trust, product innovation and ensuring the right information and support is available for people to take financial decisions.
4. Fight financial crime, focusing on those who seek to use the fact they are regulated to do harm. The FCA will go further to disrupt criminals and support firms to be an effective line of defence.

Key points:

1. Vision and priorities:

• The FCA's vision is centred on deepening trust, rebalancing risk, supporting growth, and improving lives. The strategy prioritises being a smarter regulator, supporting growth, helping consumers navigate their financial lives, and fighting financial crime.

2. Opportunities and challenges:

• The strategy identifies key challenges such as technological change, global uncertainty, demographic shifts, and challenging financial resilience. It emphasises the role of financial services in supporting growth and managing risks.

3. A smarter regulator:

• The FCA aims to become more efficient and effective by reforming regulatory processes, digitising the authorisation processes, and improving data collection. The focus is on being predictable, purposeful, and proportionate.
• The FCA will take a more flexible approach to supervision, suggesting that firms that are demonstrably seeking to do the right thing might have less rigorous supervisory programmes but more direct points of contact within the FCA.
• The FCA will share more insights from supervisory work
• The FCA will reduce the number of regular data returns required and launch My FCA to make it simpler for firms to manage regulatory obligations.

4. Supporting growth:

• The FCA plans to enhance the competitiveness of UK financial services by reforming rules, supporting innovation, and improving access to capital. Initiatives include launching Open Finance and integrating the Payment Systems Regulator into the FCA.  The FCA will publish a roadmap for the rollout of Open Finance within a year. The regulatory foundations for the first scheme should be in place by the end of 2027.
• The FCA will continue to support innovation in areas such as fund tokenisation.
• The FCA is also reviewing the redress regime and redundant requirements in the commercial insurance and asset management regimes to avoid holding back investment and innovation.

5. Helping consumers navigate their financial lives:

• Efforts will be made to improve consumer financial resilience, drive better value in pensions, and ensure fair value in insurance. The FCA will work with industry to provide a new regulatory regime for targeted support around pensions and reform information disclosures.
• The FCA want to see a higher proportion of consumers with over £10,000 in investment assets holding mainstream investments.
• The FCA will also support the Government's financial inclusion strategy.
• This will all be underpinned by the Consumer Duty.

6. Fighting financial crime:

• The FCA will continue to disrupt financial crime by leveraging technology, collaborating with partners, and enhancing consumer awareness. The focus is on reducing crime by FCA-authorised firms, and authorised push payment fraud. 

7. International role:

• The FCA aims to maintain the UK's position as a global financial hub by establishing a presence in the US and Asia-Pacific for the first time. It will advocate for global cooperation amidst geopolitical instability.

Next steps

Firms should be aware of the strategy over the next 5 years when responding to FCA consultation papers, during supervision and when implementing rules. We will be closely following the relevant developments. Please reach out to your contact in the FS Regulatory team if you would like to discuss.