The FCA said it wanted to reduce the burden on businesses by identifying rules which overlapped with the recently introduced Consumer Duty. The regulator said it aimed to “address potential areas of complexity, duplication, confusion, or over-prescription, which create regulatory costs with limited or no consumer benefit”.
Consumer Duty was introduced for open book products and services on 31 July last year, aiming to deliver good outcomes for consumers. The closed book deadline for the duty is this Wednesday.
The regulator said reducing the complexity of its rulebook could “lower costs for firms, encourage innovation and help support the risk appetite needed to support growth, ultimately boosting international competitiveness and the economy over the long-term”.
Nikhil Rathi, chief executive of the FCA, said: “We are firmly committed to playing our part in supporting economic growth. The Consumer Duty marked a major shift for firms and consumers by setting higher and clearer standards of consumer protection and requiring firms to put their customers’ needs first.
“We now want to seize the opportunity of the Duty and the move to a clear outcomes-based approach to streamline our rulebook, lowering costs for businesses and supporting the competitiveness and growth of the economy.”
Simplifying commercial insurance rules
The FCA has also announced it will simplify rules in the commercial insurance sector and it is inviting views on whether changing the way customers are categorised could reduce how long it takes to take on new customers, renew their contracts or allow products to be custom made.
The regulator said this would reduce regulatory costs and could increase competitiveness in the commercial insurance market.
This comes as the FCA published its first report on how it is supporting UK competitiveness and economic growth over the medium to long-term.
The regulator said it recognised the role it played in getting new financial services firms started by improving its authorisation process with 98% of cases now assessed within statutory deadlines, up from 78.9% in Q1 of 2022/23.
The FCA said overseas wholesale financial firms wanting to operate in the UK could benefit from pre-application support and said it had completed the “biggest reform to the listing rules in a generation”.
From 1 August, the regulator will also consult a new independent panel experts when preparing cost benefit analyses. This will apply to proposed regulations which have an estimated net annual direct cost to industry of £10m each year.
