FCA angles 2021 business plan to tackle coronavirus
9 April 2020: the Financial Conduct Authority (FCA) business plan for the forthcoming year will tackle the financial effects of coronavirus.
The FCA’s initial responses to the pandemic have included temporary measures for consumer credit products, mortgage holidays for those in financial difficulties and setting out expectations for the treatment of consumers by banks and insurers.
However, in a statement accompanying its 2021 business plan, the regulator warned it would have to “take stock of those interventions and place some on a more regular footing” as time went on.
It added that its ability to plan for the next three years was impacted by the sheer scale and unpredictability of the pandemic, so elements of its plan for the regulation and working of financial markets and transition to digital were subject to change.
“Even then, the shape and scale of the issues we need to address may have changed significantly as a result of the virus. We may publish an update to this plan if we believe it is necessary,” it wrote.
It added that it would remain vigilant to potential misconduct for those who looked to take advantage of the uncertainty and that it would raise awareness of the risk posed by scammers taking advantage of coronavirus uncertainty.
Its main external priorities as a regulator for the next year to three years are:
- Transforming how it works to be more effective
- Enable effective consumer investment decisions for pensions and savings
- Ensure the consumer credit markets work well
- Make payments safe and accessible
- Delivering fair value in a digital age, including tackling loyalty penalties.
In the background, the FCA also alluded to the end of the Brexit transition period in 2021 as one of its major challenges in the next three years.
It added that it would continue to manage culture in financial services, including the roll-out of SMCR, tackling financial crime and setting new requirements on operational resilience.
The FCA annual funding requirement has risen 5.2% year-on-year to £587.6m, to cover its activities and the EU withdrawal.
However, its capital expenditure for this year has dropped by £20m to £41.1m as it completes a ‘once-in-a-lifetime’ IT infrastructure project.
For the latest news and guidance on the ongoing impact of COVID-19 for businesses and accountants, visit ICAEW’s dedicated coronavirus hub.