The committee held an appointment session with Rathi earlier this week.
He told the MPs the issue of mortgage prisoners will be a top priority for the regulator under his leadership.
And Rathi also explained how the FCA could intervene with regulation if the financial services industry does not improve its diversity.
The new chief executive was also questioned by MPs over his independence from the Treasury and whether he has criticisms of Treasury policies.
His views on the Lifetime ISAs and his longer-term career plans were also put under the scrutiny of the committee.
Following the session, the Treasury Committee has now approved Rathi as chief executive and wished him “every success in his role”.
Rathi previously held the positions of chief executive of the London Stock Exchange and director of international development at the London Stock Exchange Group.