The UK’s Financial Conduct Authority (FCA) is set to introduce a ‘regulatory nursery’ this autumn to enhance oversight for newly authorized institutions. This initiative was announced by FCA Chief Nikhil Rathi during his address at UK Fintech Week.
Currently, newly authorized firms are treated similarly to those with established histories. Rathi emphasized that the regulatory nursery will allow for closer engagement with these companies immediately after authorization, enabling the FCA to provide necessary support and intervene proactively when needed.
Additionally, Rathi revealed plans to transform the FCA’s regulatory Sandbox from a quarterly framework into a year-round application process, supported by improved marketing strategies.
The FCA is also expanding its Digital Sandbox initiative in collaboration with the City of London Corporation, shifting its focus from post-Coronavirus recovery efforts to sustainability projects. This announcement aligns with the recent appointment of Sacha Sadan as the FCA’s inaugural Director of Environmental, Social, and Governance, tasked with leading sustainability initiatives.
Rathi remarked, “Financial innovation is crucial for achieving a net-zero economy,” highlighting that Sadan’s role will expedite efforts to foster a sustainable investment market, ensuring robust investor protection and the innovative use of data.