By Oliver Smith on Wednesday 5 January 2022
The regulator also pulled authorisation from 176 firms.
Greater numbers of new financial firms are were turned down by the UK’s financial regulator last year, as the Financial Conduct Authority said it was tightening up standards.
1-in-5 applications for FCA authorisation were turned down or withdrawn last year, compared to 1-in-6 the previous year.
FCA authorisation is required to carry out regulated financial service activities, like arranging investments, dealing in securities and offering consumer credit.
At the same time, the regulator took away authorisation from 176 firms which had not carried out regulated activity in the last 12 months.
The FCA said both moves were part of its aim to protect consumers and “more robustly” apply standards to those applying for authorisation.
But as well as tightening the rules, the regulator also said it reformed its decision-making process around authorisation to speed things up, including allowing its senior managers to make decisions on whether a firm should be granted, as opposed to having to go to the Regulatory Decisions Committee every time.
“The FCA has protected customers, enhanced the integrity of the UK’s financial system and promoted competition this year, despite the additional challenges of the pandemic,” said FCA CEO Nikhil Rathi in his review of the year.
“We are looking forward to using our innovative, adaptive and assertive approach to achieve even more for consumers and the financial market next year.”
In November the regulator also scrapped the ‘90-day’ rule which had been holding open banking back by forcing consumers to reauthenticate every 90 days.