1 in 5 firms initially rejected for authorisation: FCA

1 in 5 firms are now initially rejected for authorisation, compared to one in 14 in the previous year, according to the FCA's chief executive, Nikhil Rathi.

During a speech given last week, Rathi hailed technology investment as a key factor behind the FCA’s improved efficiency during the last year. Revealing that one in five firms are now initially rejected for authorisation, he said "huge progress" had been made on the FCA’s backlog, thanks to its investment in automation.

Rathi also said that the FCA plans to deploy expanded technology solutions going forward.

During his speech, Nikhil Rathi said: “We are always open to simplifying regulation whilst delivering the same outcomes and streamlining our processes without undermining rigour.

“As an independent regulator, we have shown we can act quickly, whether it was in our reaction to Covid, Russia, the rising cost of living and unprecedented market turbulence. It is vital that this independence and agility at speed is not undermined by any proposed call-in power. And while we embrace and embed a secondary mandate for growth, making it a primary mandate would clearly undermine our international standing.”

Dr. Henry Balani, Global Head of Industry and Regulatory Affairs for Encompass Corporation, commented: “Amidst a turbulent economy and a complicated geopolitical landscape, the UK faces uncertain and challenging times. It is essential that both businesses and the government remain committed to upholding the highest regulatory standards and encouraging innovation as a key component, in order to achieve as much stability and growth as possible – now and in the future.

“In recent months, the FCA has made strides when it comes to helping to improve the regulatory landscape and, ultimately, tackle financial crime, while also supporting businesses through extraordinary times. Despite this, there is still much to be done to further improve the regulatory framework and overall compliance in the UK. As we progress, we must continue to focus on not only regulatory oversight but also on fostering innovation and the use of the latest in technology to assist businesses when it comes to their own compliance processes as the landscape evolves."