The Panel’s aim is to provide early and effective practitioner input into the FCA’s policy development from a smaller firm perspective.
Within the overall objective of considering the impact of regulation on smaller firms it has the following areas of focus:
Growth and innovation
- Highlight where the totality of regulatory change is inhibiting investment and innovation
- Support smaller firms to survive and thrive, and identify barriers to their growth
- Regulation which supports innovation including AI adoption by smaller firms
- Role of smaller firms in expanding consumer choice and providing access to specialist products and services
- Long-term financial services sector reputation and attractiveness
Proportionality of Regulation
- Balanced consideration of the risks of intervention vs non-intervention for firms and consumers
- Constructive challenge on consideration of the expected benefits relative to costs of proposed interventions
- Regulation driven by data insights and conclusions
- Regulation is proportionate to firm size, complexity/structure, product type and risk of harm to the market and consumers
- Technology/AI is deployed in a way that ensures new data requirements add value while not significantly increasing reporting burden
Effectiveness of Regulation
- Financial capability work helps consumers withstand financial shocks and invest for the future
- How effectiveness will be measured by data outcomes
- Interpretation of the Consumer Duty, simplification of rules, and guidance
- Unintended consequences of policy design
- Assess the impact of emerging external risks