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Wider access to credit unions for consumers, simplifying regulation and reducing the number of regulators are some of the changes being brought forward.
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This is part of the Government’s plan to build a stronger and fairer economy, building on good growth in the first quarter of this year.
British business will become more globally competitive, growth and investment will be unlocked across the country and greater protections will be put in place for consumers under new legislation that has been introduced to Parliament this week.
The Financial Services and Markets Bill will modernise how the sector is regulated, and enable it to grow and lend more to businesses. It will also make consumer protections fit for the digital age – all while maintaining high standards on regulation and oversight, supporting the UK’s position as a leading global financial centre.
The Bill will include a power, pending the outcome of an independent review, to ensure the Government can protect access to face-to-face banking where communities rely on it. And widening access to credit unions so more people can access safe and affordable finance are among the changes.
Simplifying regulation and reducing the number of regulators is among the changes being made to support businesses, so decisions are made quicker and their growth isn’t held back. The Bill will also support lending and investment including by updating the statutory framework underpinning the ring-fencing regime.
This is part of the Government’s wider plan to build a stronger and fairer economy for all, building on good growth in the first quarter of this year.
Economic Secretary to the Treasury, Rachel Blake, said
Our financial services sector is world-leading, creating jobs, boosting growth and firing up our economy in Leeds, Manchester, Edinburgh and London.
This Bill will unlock even more growth in the sector, making red tape less burdensome to business and boosting protections for consumers – part of our plan to build a stronger and fairer economy.
The Bill will ramp up protections and accessibility to finance for British consumers by
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Modernising consumer protections and redress arrangements. Consumers will be better protected when something goes wrong and terms and conditions will have to be worded in simpler terms so everyone can understand them. Reforms to the Financial Ombudsman Service will allow people to resolve disputes faster and with greater certainty.
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Allowing credit unions to expand by improving the rules on who can become a member. This will allow credit unions to serve more people and communities, widening access to affordable finance and supporting the Government’s aim to double the size of the mutual and co-operative sector.
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Ensuring access to in-person banking services for the future. Subject to an independent review, the Government will take the power to ensure communities retain their access to face-to-face banking where they need it. This is particularly important for rural communities and pensioners who are not online.
The financial services sector will also be supported to innovate and grow by
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Simplifying regulation and reducing the number of regulators. Responsibilities of the Payment Systems Regulator will be absorbed by the Financial Conduct Authority. This means firms will have fewer overlapping regulators to deal with and will see faster decision making, allowing them to grow faster.
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Ensuring that the administrative burden on firms is proportionate while keeping important consumer and market protections. This includes reducing the overall burden of the Senior Managers and Certification Regime – the framework that holds senior leaders in financial firms personally accountable – by 50 per cent. This will free up firms to focus on serving customers and invest in growth, rather than dealing with overly burdensome compliance processes.
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Supporting lending and investment by updating the statutory framework underpinning the ring-fencing regime. This regime requires major banks to separate their UK retail banking services from investment banking activities. The reforms will unlock more finance for UK businesses, especially smaller businesses who will be able to access finance more easily.