Janine Hirt, CEO of Innovate Finance has given evidence to a House of Lords Committee investigating the implementation of the the FCA’s and PRA’s secondary objective.In her opening address and answers to the committee she set out:

• The contribution that Innovate Finance members make to consumers and the UK economy as a whole.
• The fact we are a global leader in FinTech and it being the crown jewel in our tech sector, but that is at risk if we do not continue to see the progress that was initially made with the implementation of Open Banking.
• The key role that Government and regulators can play in helping FinTech to do more for society and the economy and the important role of the secondary objective in helping to achieve that.

Recommendations she gave for regulators included:

• Having a tech-positive mindset; considering in their policies the impact of their work on growing and scaling firms. This might include running separate cost benefit analysis to see the impact of policies on smaller firms and having proper regulatory support beyond sandboxes for firms as they scale and grow.
• Faster and better authorisations, including more granularity of data to show this across sizes of firm - to highlight the in particular how progress is made for FinTech.
• Work faster, more strategically and better aligned with other regulators - in areas such as Open Banking, digital asset regulation, payments and Open Finance.
• Removing outdated regulations and barriers to growth.
• How Capital requirements impact challenger banks in particular.

The key areas of investigation for the Committee include:

• The FCA's strategic objectives: Are they clear, appropriate, and well-aligned with consumer protection?
• Performance and impact: How effectively is the FCA meeting its objectives? Are its resources sufficient?
• Consumer protection: Is the FCA doing enough to protect consumers from harm? How responsive is it to emerging risks and consumer needs?
• Accountability and governance: Is the FCA sufficiently accountable to Parliament and the public? Is its governance structure effective?
• Culture and approach: Is the FCA's culture conducive to effective regulation and consumer protection? Is it proactive and innovative enough?

Next steps

The committee is currently gathering evidence through written submissions and oral hearings, to which we have provided oral evidence and will be supplying written submissions. Based on the evidence gathered, the committee will publish a report with findings and recommendations for the FCA and the government. This report could influence future policy and regulatory changes within financial services.

This inquiry is significant because it holds the FCA to account and could lead to improvements in its effectiveness and consumer protection efforts. The committee's findings and recommendations could shape the future of financial regulation in the UK.

You can read our CEO's opening statement here.