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AMI welcomes FCA fee reduction for intermediary firms

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  • 06/07/2020
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AMI welcomes FCA fee reduction for intermediary firms
The Association of Mortgage Intermediaries (AMI) has praised the Financial Conduct Authority for reducing Financial Services Compensation Scheme fee costs for mortgage intermediary firms.

 

In its policy statement for 2020/21 which was published last week, the regulator confirmed it would freeze fees to protect smaller firms which make up 71 per cent of regulated companies.   

This means for firms whose turnover has remained consistent, there will be a year-on-year reduction in costs, largely due to a decrease in the levies paid towards the Financial Services Compensation Scheme (FSCS). 

The fees to be paid by mortgage firms in 2020/21 have been reduced by one per cent to £6.8m. 

For firms that are in the medium and smaller category with a turnover of less than £10,000, payment will be due within 90 days of the date of the invoice instead of 30 days. Larger firms are expected to pay their fees and levies under usual terms. 

Robert Sinclair, chief executive of AMI, said: “AMI welcomes the reduction in FSCS fee costs for firms in the midst of this pandemic and at a time when capital resources are more challenging for firms. 

“Whilst delighted that firms will not see a real increase in their total fees and levies costs this year, we remain acutely aware of the challenges faced by firms and the interrelation between capital adequacy requirements, professional indemnity insurance, Financial Ombudsman Service and the FSCS costs. 

I was heartened to hear Charles Randell’s [FCA chair] statement that they needed to redesign the system to ensure that polluting firms in the financial sector pay, not those who have behaved well.  

AMI will continue to work to hold the FCA to account and ensure that intermediary fees are proportionate to the risks posed, he added. 

 

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