PS11/26 finalizes PRA rules enhancing Pillar 3 disclosures on resolvability resources (MREL), capital distribution constraints (CDCs), and disclosure basis for UK banks and building societies. It matters because it standardizes information to boost market discipline, user comparability, and confidence in orderly resolution, directly impacting financial stability and compliance reporting. No substantive changes from CP16/25 consultation, with minor clarifications only.
What Changed
Standardized MREL disclosure templates: Replaces free-form disclosures with four new templates aligned to Basel BCBS TLAC formats (adapted for UK), expanding scope to more firms for consistency on MREL adequacy.
Qualitative CDC narrative: Added to UK CC1 template for firms subject to CDCs, enabling market assessment of restriction impacts; removes obsolete Systemic Risk Buffer (SRB) disclosure post-O-SII buffer replacement.
Disclosure basis statement: Firms must specify their Pillar 3 regime (e.g., resolution entity, O-SII, large institution), frequency, and details like reference date,...
What You Need To Do
Update Pillar 3 processes to use new MREL templates (Annex XXVII instructions), UK CC1 with CDC narrative, and basis statement (e
For CDC-subject firms
Ensure semi-annual disclosure of key metrics (Article 447 points a-g) where required
Integrate into consolidated reporting for UK parents; test templates/instructions from appendices
Review for alignment with broader CRR changes (e
Key Dates
17 March 2026- PS11/26 and accompanying rule instruments (e.g., Disclosure (CRR) Instrument 2026) published.
1 January 2027- Policy effective date; rules apply from this date.
H1 2027- First disclosures under new policy published, covering period ending **31 December 2026** (annual/semi-annual as applicable).
Compliance Impact
Urgency: High – Effective 1 January 2027 requires immediate template/system updates for H1 2027 disclosures (year-end 2026 data), with standardized formats limiting flexibility and raising non-compliance risks to market discipline objectives. Impacts reporting teams, resolution planning, and investor relations; proportional design minimizes burden but demands proactive gap analysis given no transition grace beyond effective date.
We’ve confirmed new rules to make existing incident and third party reporting clearer, more consistent, and easier for firms to follow. These new rules will help us respond quickly to disruption such as a cyber attack or power outage, give firms greater certainty on what to report and when and strengthen firm resilience to better protect consumers and markets.Cyber attacks are becoming more frequent and more sophisticated, and firms are increasingly reliant on third party providers. In 2025, ...
On 23 January 2026, the FCA imposed requirements on Sendsii Ltd which prevent them from carrying out any regulated activity. The FCA has issued a First Supervisory Notice to Sendsii Ltd after HM Revenue and Customs (HMRC) suspended the firm’s registration on 9 October 2025. The suspension means that Sendsii Ltd no longer met the conditions required for its FCA authorisation under the Payment Services Regulations 2017.These requirements prevent Sendsii Ltd from carrying out any regulated activ...
Images of the UK’s wildlife are to feature on the next series of banknotes following a public consultation run by the Bank of England.
AI Analysis
The Bank of England has announced that **wildlife imagery will replace historical figures on the next series of banknotes**, following a public consultation in which nature received 60% support. This decision represents a significant shift in banknote design policy and carries implications for currency authentication, public engagement, and operational planning across the payments ecosystem.
What Changed
The Bank of England is implementing the following design changes:
Theme Selection: Wildlife native to Britain will feature on all denominations (£5, £10, £20, £50) of the next banknote series, replacing historical figures such as William Shakespeare, Winston Churchill, and Jane Austen.
Monarch Continuity: King Charles' portrait will continue to appear on all notes.
Security Integration: Wildlife imagery has been selected partly for its effectiveness in developing banknotes with easily recognizable and distinguishable security features.
Scope Expansion: The design may incorporate additional...
What You Need To Do
*Monitor the summer 2026 consultation
*Plan for authentication updates
*Update systems and procedures
*Engage with BoE communications
*Prepare customer communications
Key Dates
July 2025- Initial public consultation on banknote themes closed
Summer 2026- Second public consultation to gather views on specific wildlife species (announced as forthcoming)
Future (multi-year process)- Design, testing, and printing of next-generation banknotes with anti-counterfeiting technology
Several years ahead- Issuance of next generation of banknotes
Speech by David Geale, executive director, payments and digital finance, and PSR managing director at the MoneyLIVE Summit 2026, London. ConsolidationRule 1 is ‘Out of clutter, find simplicity.’The Government announced its intention to consolidate the PSR into the FCA about a year ago. It was a decision we welcomed.Our work has always been complementary, and we made it work.As an economic regulator, the PSR is focused on getting the foundations right – the payment systems and infrastructure t...
The Bank's Court of Directors acts as a unitary board, setting the organisation's strategy and budget and taking key decisions on resourcing and appointments. Required to meet a minimum seven times per year, it has five executive members from the Bank and up to nine non-executive members.
The Payments Vision Delivery Committee (the Committee) has published the Payments Forward Plan (the Plan). Read the Plan on GOV.UKThe Committee comprises:HM TreasuryBank of EnglandFinancial Conduct AuthorityPayment Systems RegulatorThe Plan sets out upcoming initiatives across retail and wholesale payments, including elements of digital assets. Recent publications on open banking, stablecoins and contactless limits, alongside the initiatives in the Plan, show the high level of activity across...
AI Analysis
The Payments Vision Delivery Committee—comprising HM Treasury, Bank of England, FCA, and Payment Systems Regulator—has published the **Payments Forward Plan**, a three-year regulatory roadmap for retail, wholesale payments, and digital assets, aligning with the UK's National Payments Vision for a trusted, innovative ecosystem. This matters for compliance teams as it provides sequencing and milestones for multiple initiatives, enabling proactive planning amid high regulatory activity, including PSR consolidation into FCA and infrastructure upgrades. It signals coordinated efforts to boost competition, resilience, and innovation while minimizing sector capacity strain.[FCA publication]
What Changed
No immediate binding regulatory changes are imposed by the Plan itself; it is a forward-looking roadmap outlining planned initiatives rather than new rules. Key elements include:
Modernisation of payments framework: Consolidation of PSR into FCA, with HMT consultation response in Q1 2026; data/operational enhancements to Faster Payments and Bacs by end-2026.
Infrastructure upgrades: Short-term resilience improvements to Faster Payments and Bacs (end-2026); exploration of regulated stablecoins for on-chain settlement (H1 2026).
Safeguarding enhancements: FCA Supplementary Regime effective May...
What You Need To Do
Review the full Plan on GOV.UK (https
Engage proactively
Stablecoin firms
Monitor and plan
Internal audit
Key Dates
Q1 2026 - HMT consultation response on PSR consolidation into FCA.
Jan-Apr 2026 - FCA engagement with sector on Supplementary Safeguarding Regime.
Feb-Mar 2026 - Independent assessment of proposals for standards setting body.
Spring 2026 - HMT update on Consumer Credit Act reform.
18 January 2026 - Deadline for stablecoin issuers to apply to FCA regulatory sandbox(related push for innovation).
Compliance Impact
Urgency: Medium. This is a planning document, not enforceable rules, but its milestones trigger near-term actions (e.g., Q1 2026 engagements, May 2026 safeguarding). It matters because it coordinates high-activity areas like PSR-FCA merger and stablecoins, reducing surprises but demanding resource allocation for innovation/resilience amid sector capacity constraints. Firms delaying review risk missing input opportunities or readiness gaps, especially with VRP/stablecoin momentum.
The FCA has chosen 4 companies to test how their stablecoin services work with proposed regulation in a safe environment. The stablecoins cohort is part of our commitment to supporting growth and innovation in UK financial services. 20 applications were received and the FCA has chosen the following firms:Monee Financial TechnologiesReStabiliseRevolutVVTXThe Regulatory Sandbox programme allows firms to trial stablecoin products in real world conditions with appropriate safeguards. It will help...
We have signed a Memorandum of Understanding (MoU) with the Independent Football Regulator (IFR). The MoU establishes how the 2 organisations will work together and support effective regulation where football and financial services intersect.It also sets out a high-level framework for principles for cooperation between the IFR and the FCA.Read the MoU (PDF)
AI Analysis
The FCA has signed a Memorandum of Understanding (MoU) with the newly established Independent Football Regulator (IFR) to define cooperation on regulating intersections between football clubs and financial services, such as ownership suitability, licensing, and financial sustainability. This matters for compliance professionals as it formalizes information sharing and joint oversight, potentially impacting firms involved in football-related financing, investments, or consumer credit products tied to sports. It supports the Football Governance Act 2025 framework, enhancing regulatory alignment where financial misconduct could affect club operations.[https://www.fca.org.uk/news/statements/mou-independent-football-regulator-fca]
What Changed
Establishes a high-level framework of principles for cooperation between FCA and IFR, focusing on effective regulation at the football-financial services nexus.
Outlines how the organizations will work together, including information sharing on matters like club owners' financial dealings, licensing compliance, and enforcement where financial services intersect with IFR's duties (e.g., suitability tests for owners/officers, financial resources thresholds).[https://www.fca.org.uk/news/statements/mou-independent-football-regulator-fca]
Builds on prior MoUs (e.g., FCA-UKGC models) by addressing...
2025 - Football Governance Act 2025 enactmentEstablishes IFR statutory powers, including provisional/full club licensing from this date onward.
Ongoing - IFR licensing rolloutClubs transition from provisional to full licenses once threshold conditions (e.g., financial resources, owner suitability) met; no fixed end-date.
Compliance Impact
Urgency: Medium – This MoU does not impose new binding rules or deadlines but signals heightened cross-regulator focus on football finances post-Football Governance Act 2025, risking enforcement overlaps or info requests. It matters for firms with niche exposures (e.g., sports financing) to avoid gaps in owner due diligence or financial promotions, potentially amplifying AML/conduct risks amid IFR's divestment powers.
We have signed an Exchange of Letters with the International Financial Services Centres Authority (IFSCA). IFSCA is the unified regulator for financial institutions operating in Gujarat International Finance Tec-City (GIFT City), India’s first international financial services centre.This agreement affirms both authorities’ commitment to develop our regulatory relationship.Download our letter (PDF)The letters set out the intention to share regulatory knowledge and best practice to support the ...
AI Analysis
The FCA has signed an Exchange of Letters with India's IFSCA, the regulator for GIFT City, to foster regulatory cooperation, knowledge sharing, and stronger links between UK financial markets and GIFT City. This matters for compliance professionals as it signals expanding cross-border ties, potentially easing market access and harmonizing standards for firms operating between the UK and India, amid the FCA's broader global outreach strategy. No binding rules are imposed, but it sets the stage for future alignment in areas like fintech and financial services.
Urgency: Low - This is a cooperative MoU-style letter exchange without immediate rules, penalties, or obligations, posing minimal disruption risk. It matters strategically for long-term planning, as it could lead to simplified compliance for UK-India activities (e.g., reduced dual-regulation friction) and aligns with FCA's pattern of global pacts that indirectly shape supervisory expectations. Firms with India exposure should note it for horizon scanning, but no urgent resourcing is needed.
We have published a letter to trade associations to provide an update in the development of a Future Entity (FE) for open banking. The letter confirms the appointment of KPMG to provide an independent assessment of proposals to establish a standards-setting body for UK open banking APIs that is capable of becoming the Future Entity. It explains the purpose and scope of the assessment, the respective roles of the FCA, industry, trade associations and the independent assessor, and how firms can...
AI Analysis
The FCA has appointed KPMG to conduct an independent assessment of proposals for establishing a **Future Entity** – a standards-setting body for UK open banking APIs that will replace Open Banking Limited. This initiative is critical because it establishes the governance framework for open banking ahead of new legislative powers the FCA will receive under the Data (Use and Access) Act 2025, with a statutory instrument expected by end-2026.
What Changed
The regulatory landscape for UK open banking is undergoing fundamental restructuring:
Transition of regulatory authority: The FCA is becoming the primary regulator for open banking, replacing the Joint Regulatory Oversight Committee (JROC).
Future Entity establishment: A new standards-setting body will become the primary UK standard-setting organization for open banking APIs, responsible for setting and maintaining common standards for minimum service and interoperability, monitoring API performance, and providing directory and certification services.
Independent assessment process: KPMG...
What You Need To Do
*For industry participants and trade associations
*Engage with the assessment process
*Arrange FCA Q&A sessions
*Coalesce behind proposals
*Prepare for VRP implementation
Key Dates
February 2026– Independent assessment process begins; KPMG commences evaluation of proposals
Q1 2026– Final design of Future Entity expected; live transactions expected through VRP scheme
Before March 2026– FCA's Open Finance roadmap due for publicationDEADLINE
Early April 2026– KPMG delivers final assessment report; FCA publishes on its website
From April 2026– Industry and regulators collaborate to progress establishment activity
From 6 April 2026, Gemini is closing all customer accounts in the UK. Gemini Payments UK, Ltd (GPUK) is authorised by the FCA to issue electronic money (e-money) and provide payment services.Gemini Intergalactic UK, Ltd (GIUK) offers cryptoasset products. These activities are not regulated by the FCA, although we oversee compliance in accordance with UK anti-money laundering regulations. On 5 February 2026, GPUK and GIUK confirmed they plan to exit the UK market. Effective 6 April 2026, Gemin...
In October 2025, 25 financial institutions active in the UK foreign exchange (FX) market participated in the semi-annual turnover survey for the Foreign Exchange Joint Standing Committee (FXJSC).
Speech by David Geale, executive director, payments and digital finance and Payment Systems Regulator (PSR) managing director, at the Payments Regulation and Innovation Summit 2026. A payments system that works for everyoneJust before Christmas I was in Billericay for the opening of the 200th banking hub.I got to chat to local people and business owners about the difference the hub will make to their everyday lives. It was great.Although if I’m honest, the biggest talking point was probably t...
AI Live Testing now open for applicationsAt the FCA, we’re providing a structured but flexible space where firms can test AI-driven services in real-world conditions, all with our regulatory support and oversight and help from our technical partner, Advai. Collaboration and communication is at the heart of what we are doing.The first cohort joined AI Live Testing in October last year. We opened a second application window on 19 January 2026 and are now inviting applications.Moving on from 'PO...
AI Analysis
The FCA's AI Live Testing initiative provides a voluntary, structured program for firms with mature AI proofs-of-concept (POCs) to test AI-driven services in controlled real-world environments under regulatory oversight and support from technical partner Advai. This matters because it enables safe progression from 'POC paralysis' to deployment, while helping the FCA gather insights on translating AI principles into consumer and market protections, informing future regulation. Participation enhances firms' governance, risk management, and evaluation frameworks for responsible AI use in financial services.
What Changed
This is not a mandatory regulatory change but a voluntary testing service launched by the FCA; no new enforceable requirements are imposed. Key elements include a holistic focus on the AI system (model + deployment context, risks, governance, human-in-the-loop, evaluation, input/output controls) rather than isolated foundation models. The program features three phases: Discovery, Framework validation, and AI system testing (quantitative/qualitative), emphasizing live monitoring, governance, and risk management. It complements the FCA's Supercharged Sandbox for earlier-stage AI exploration.
What You Need To Do
Review FCA's Terms of Reference (PDF) for eligibility, focusing on mature POCs and enterprise-level AI systems
Submit application form via FCA portal by 2 March 2026 if ready for live testing; contact suptech@ fca
Prepare documentation on AI system components (model, context/risks, governance, human oversight, evaluation, controls) for three-phase process
Assess internal governance, data, risk frameworks, and monitoring for AI readiness; consider non-participation but monitor for future FCA expectations
Firms not selected should use insights from first cohort (e
Key Dates
19 January 2026- Second application window opens.
2 March 2026- Application deadline for second cohort.DEADLINE
Mid-March 2026- Notification of successful applicants.
April 2026- Testing starts for second cohort.
October 2025- First cohort began testing (historical reference).
Compliance Impact
Urgency: Medium - Voluntary program, but signals FCA's proactive stance on AI oversight; non-participation risks lagging in best practices for Consumer Protection / Conduct and Operational Resilience / Outsourcing as regulator builds evidence for potential rules. Matters for competitive edge in AI deployment and demonstrating alignment with principles-based regulation amid 'POC paralysis'. Early movers gain tailored support, intelligence-sharing on risks, and influence on FCA's evolving AI approach.
We’re working closely with the Office of Financial Sanctions Implementation (OFSI), UK law enforcement, and our regulatory partners to tackle the abuse of cryptoassets and associated money‑laundering activities. Read the full blog on the OFSI’s website.
On 21 January 2026, Guavapay Limited entered compulsory liquidation. The Official Receiver, an officer of the Insolvency Service, is its liquidator. Guavapay is authorised by the FCA to issue E-money and provide payment services to its customers.On 17 September 2025, Guavapay agreed to a voluntary requirement with the FCA, restricting the activities it can undertake. See details on the Financial Services Register.As liquidator, The Official Receiver is responsible for:Managing customer claims...
The FCA's guidance outlines good and poor practices in communicating costs for international money remittance and cross-border payments involving currency conversion, emphasizing transparency under the Consumer Duty to enable informed consumer decisions. It matters because non-compliance risks supervisory action, as the FCA plans future reviews to assess improvements, raising the bar on pricing clarity amid ongoing Duty enforcement.
What Changed
This is not new rulemaking but illustrative guidance applying existing Consumer Duty rules from FG 22/5 and PRIN 2A.5.3R, which mandate communications that are clear, fair, not misleading, meet retail customers' information needs, are understandable, and support effective decisions. Key emphases include pre-transaction disclosure of: amount remitted (GBP), applied exchange rate (explaining markups as consumer costs), recipient amount (local currency), variable/fixed fees, total fees, and intermediary/recipient bank fees where applicable.
What You Need To Do
Review and update pre-transaction communications (e
Ensure markups are framed as consumer costs, not obscured (e
Monitor communication effectiveness regularly under Consumer Duty to confirm good outcomes, enabling cost comparisons and informed choices
Apply principles to all channels; proactively disclose fee variability and third-party impacts
Key Dates
31 July 2023- Consumer Duty effective date for new and existing products/services.
1 May 2025- FCA publication date of this good/poor practice guidance.
Compliance Impact
Urgency: High – Consumer Duty is live since 2023, but this 2025 guidance signals intensified FCA scrutiny on payments transparency, with planned follow-up work and engagement to enforce improvements. Firms risk remediation demands or enforcement if disclosures remain inadequate, especially as it targets common weaknesses like hidden fees amid broader Duty portfolio reviews.
FCA PS25/19 finalizes rules to streamline complaints reporting by replacing multiple existing returns with a single consolidated return, enhancing data quality, consistency, and vulnerability identification while reducing burdens. This matters for compliance teams as it mandates system and process updates to improve regulatory oversight and consumer protection, with implementation required within 12 months.
What Changed
Consolidated complaints return: Replaces five existing returns (DISP 1 Annex 1, Consumer Credit Return (CCR), Funeral Plans (FP), Claims Management Companies (CMCs), and Electronic Money and Payment Services Return (PSR)) with one unified return to reduce duplication and improve comparability.
Permission-based reporting: Firms report only sections relevant to their regulated permissions, targeting reporting to specific activities.
Simplified nil returns: Proportionate approach allows upfront selection for firms with no complaints.
Removal of group reporting: Shifts to individual legal...
What You Need To Do
Review and update internal complaints recording, categorization, and reporting systems to align with new consolidated return, taxonomy, permission-based sections, and vulnerability data points
Integrate FCA Vulnerability Guidance into complaints processes for identification and reporting
Test and prepare for fixed 6-monthly submissions via FCA systems; complete nil return simplifications where applicable
For Retail Banking, Insurance, Payment Services, and CMCs: Retain and adapt contextualised data capture
Key Dates
2025Consultation opened.[User Query]
2025Consultation closed.[User Query]
2025Policy Statement PS25/19 published, with 12-month implementation period starting.
2026Feedback deadline on Chapter 4 questions (email to FCA).DEADLINE
202730/06/2027 - First reporting period under new process.
Compliance Impact
Urgency: High – With publication on 3 Dec 2025 and a 12-month implementation window (to ~Dec 2026), firms must prioritize system changes now, as the first period starts 1 Jan 2027; non-compliance risks enforcement, especially on vulnerability reporting and transparency, amid FCA's focus on consumer protection data quality.
CP25/15 proposes prudential rules and guidance for UK firms issuing **qualifying stablecoins** and safeguarding **qualifying cryptoassets**, aiming to foster a safe, competitive crypto sector while prioritizing consumer protection and market integrity. This matters for compliance professionals as it introduces tailored prudential sourcebooks (COREPRU and CRYPTOPRU) to mitigate firm failure risks, aligning with the FCA's crypto roadmap and Treasury's statutory plans.
What Changed
Prudential Sourcebooks: Introduces COREPRU (core requirements across sectors) and CRYPTOPRU (crypto-specific calibrations) for "CRYPTOPRU firms" handling regulated crypto activities, covering own funds adequacy, capital resources, and stress-adjusted internal capital assessments.
Own Funds and Capital Rules: Firms must hold financial resources adequate in amount and quality, including adjustments for valuation uncertainty, stress realizable values, and interim profits in CET1 capital; supplements threshold conditions and principles requiring appropriate resources.
Risk Management and...
What You Need To Do
Respond to Consultation
Assess Applicability
Prepare Prudential Frameworks
Engage on Related CPs
Data and Reporting Readiness
Key Dates
28/05/2025- Consultation opens and CP first published.
31/07/2025- Consultation closes; submit feedback via online form, email ([email protected]), or post.
Post-31/07/2025- FCA considers feedback and publishes final rules (no specific date given).
Q3 2025- Upcoming Conduct and Firm Standards CP affecting all cryptoasset firms, including QS issuers and custodians.
Future (CP2 per Roadmap)- Consultation on remaining prudential sourcebook requirements.
Compliance Impact
Urgency: High – As of January 2026, the consultation closed over five months ago, signaling imminent final rules that could reshape prudential requirements for crypto firms; non-compliance risks authorization barriers, enforcement, or market exclusion in a regime prioritizing stability amid global crypto growth. This elevates risks for firm failures and consumer harm, demanding immediate gap assessments to align with proportionate standards supporting innovation.
We have issued a joint statement with the Payment Systems Regulator (PSR) giving clarity on open banking pricing models. We and the PSR have issued the following statement (PDF).This confirms we will not, at this stage, prioritise a Competition Act 1998 (CA98) investigation into the centralised ‘access fee’ pricing model being developed by the UK Payments Initiative (UKPI) for commercial Variable Recurring Payments (cVRPs). cVRPs are an emerging open banking technology that allow consumers to...
AI Analysis
The FCA and PSR have jointly confirmed they will not prioritize a Competition Act 1998 investigation into the UK Payments Initiative's (UKPI) centralized access fee pricing model for commercial Variable Recurring Payments (cVRPs), with the CMA's concurrent agreement. This regulatory clarity provides temporary certainty for cVRP development ahead of anticipated legislation by end-2026, creating a critical window for firms to develop compliant commercial models in this emerging open banking technology.
What Changed
The regulatory statement establishes the following key positions:
Non-prioritization of CA98 investigation: The FCA, PSR, and CMA have jointly confirmed they will not prioritize competition law enforcement against UKPI's centralized access fee model for Phase 1/Wave 1 cVRPs (limited to "lower risk" use cases).
Scope limitation: The regulatory clarity applies only to Phase 1/Wave 1 of UKPI's cVRP scheme, specifically addressing lower-risk payment use cases including regulated financial services, utilities, and public sector payments.
Temporary framework: This is explicitly a temporary...
What You Need To Do
*For UKPI and participating firms
*Governance documentation
*Pricing methodology transparency
*Phase 1/Wave 1 compliance
*Market engagement
Key Dates
15 January 2026- FCA and PSR wrote to CMA setting out their non-prioritization position
16 January 2026- CMA confirmed alignment with FCA/PSR position on CA98 prioritization
20 January 2026- Joint FCA/PSR statement issued on open banking pricing models
Q1 2026- Expected first live UKPI cVRP payments
End of 2026- Government anticipated to introduce legislative framework granting FCA new open banking powers
The FCA and PSR have issued a joint statement providing clarity on open banking pricing models, specifically regarding the centralised 'access fee' pricing model for commercial Variable Recurring Payments (cVRPs). This statement confirms that they will not prioritize a Competition Act 1998 investigation into this model at this stage. The goal is to support the development of cVRPs, giving consumers more control over their payments and lowering processing fees for businesses.
What Changed
The FCA and PSR have clarified their enforcement position on the UKPI's proposal for a commercial model for cVRPs, indicating they will not prioritize a Competition Act 1998 investigation at this stage.
What You Need To Do
Monitor market developments and updates on the legislative framework for open banking
Review and understand the implications of the centralised 'access fee' pricing model for cVRPs on your business operations
Ensure compliance with existing competition laws and regulations
Key Dates
31 Dec 2026Expected implementation of the government's legislative framework for open bankingDEADLINE
1 Jul 2027End of the temporary measure if the legislative framework is not implementedDEADLINE
Non-Compliance Risk
Enforcement action, fines, or other regulatory penalties for non-compliance with competition laws and regulations
The FCA, Bank of England and Prudential Regulation Authority have together signed a Memorandum of Understanding (MoU) with the European Supervisory Authorities to enhance cooperation and oversight of critical third parties (CTPs) that fall under the UK’s CTP regime.The MoU establishes a framework for coordinating and sharing information on the oversight of CTPs under the UK regime and critical third party providers (CTPPs) under the EU’s Digital Operational Resilience Act (DORA), including du...
AI Analysis
The FCA, Bank of England (BoE), and Prudential Regulation Authority (PRA) have signed a Memorandum of Understanding (MoU) with the European Supervisory Authorities (ESAs) to coordinate oversight of critical third parties (CTPs) under the UK's CTP regime and critical third party providers (CTPPs) under the EU's Digital Operational Resilience Act (DORA). This matters because it enhances cross-border information sharing and cooperation during incidents like cyber-attacks, reducing regulatory duplication while bolstering financial stability and operational resilience for firms reliant on these providers.
What Changed
Establishes a framework for timely information sharing, coordination of oversight activities, and joint responses to incidents affecting CTPs/CTPPs, including power outages or cyber-attacks.
Defines principles for cooperation on mutually designated CTPs/CTPPs, including notifications of investigations and best endeavors to share material information where legally and operationally feasible.
Complements the UK's CTP regime (effective 1 January 2025), which requires designated CTPs to provide regular assurance, conduct resilience testing, and report major incidents, without altering firms'...
What You Need To Do
For CTPs/CTPPs
For financial firms/FMIs
Regulators' internal actions
Firms should review contracts with third parties for compliance alignment and conduct gap analyses against CTP requirements
Key Dates
1 January 2025UK CTP rules came into effect, applying to CTPs designated by HMT.
Ongoing (process begun pre-2025)HMT designation process for CTPs, with regulators recommending based on concentration and materiality criteria; no fixed end date specified.
DORA effective date (prior context)EU CTPPs oversight under DORA aligns with UK regime; MoU signed to ensure compatibility (exact DORA timeline not in publication but supports post-2024 implementation).
Compliance Impact
Urgency: High – The MoU operationalizes the live UK CTP regime (effective January 2025), with designations underway, amplifying risks of non-compliance for firms using critical ICT providers amid rising cyber and resilience threats. It matters for cross-border firms as it enables regulator-to-regulator data sharing, potentially exposing gaps in outsourcing arrangements and increasing enforcement scrutiny without fines on CTPs yet possible future powers.
People could find it easier to pay using contactless, thanks to greater flexibility and the removal of red tape by the FCA. Banks and payment providers with strong fraud controls will be able to set their own limit for contactless payments, allowing them to better respond to changing consumer demands, inflation and new technology. They are also being encouraged to let customers set their own limit, or turn contactless off altogether, as many high street banks already do. People are using cont...
Open banking in the UK is growing rapidly. Latest industry figures show there are more than 16 million users now benefiting from the service. The number of open banking payments has soared by 53% year on year, reflecting a significant shift in how consumers and businesses manage their finances.See the API performance statsA key driver of this transformation is the rise of variable recurring payments (VRPs), which now account for 16% of all open banking transactions. VRPs allow consumers and b...
The Bank of England chairs the London Foreign Exchange Joint Standing Committee (FXJSC) Operations Sub-Committee. The FXJSC is made up of market participants, infrastructure providers and the UK financial regulators.
The Bank of England chairs the London Foreign Exchange Joint Standing Committee (FXJSC) Legal Sub-Committee. The FXJSC is made up of market participants, infrastructure providers and the UK financial regulators.
The Bank of England chairs the London Foreign Exchange Joint Standing Committee (FXJSC), which is a forum for discussion of the wholesale foreign exchange market. The FXJSC is made up of market participants, infrastructure providers and the UK financial regulators.
The Bank of England welcomes the Financial Conduct Authority (FCA) recognition of the 2024 versions of the FX Global Code and UK Money Markets Code under its code recognition scheme.
This joint PRA-FCA consultation (CP23/25 from PRA and Chapter 4 of FCA's CP25/33) proposes policy updates to regulatory fees, levies, and invoice processes for 2026/27, including new fee blocks for emerging activities like PISCES operators and targeted support, alongside adjustments to FOS/FSCS levies and payment timelines. It matters for compliance teams as it directly impacts budgeting, fee calculations, and cash flow management for fee-payers, with potential cost increases and procedural changes effective from April 2026.
What Changed
New fee structures: Introduction of a periodic fee block for PISCES operators based on regulated income (baseline £2,200 annual fee, variable above £500,000 threshold); extension of fee-block A.13 to include "targeted support" activities (Category 2 variation fee for existing firms, Category 4 for new entrants); registration fees for Deferred Payment Credit (DPC/buy-now-pay-later) activities aligned with Temporary Permissions Regime, added to FOS consumer credit fee-block but excluded from FSCS.
Levy adjustments: Addition of targeted support to FSCS Class 2, Category 2.1 (life...
What You Need To Do
Review current fee/levy exposure and model impacts of new blocks (e
Assess invoice processes if paying £50,000+ in FCA/PRA fees; prepare for aligned due dates
Submit consultation responses by deadlines, focusing on targeted support by 9 January 2026
Budget for potential fee increases; monitor Spring 2026 fee-rates CP
For applicants
Key Dates
9 January 2026- Deadline for comments on targeted support proposals (FCA CP25/33 paras 2.11-2.18, questions 3-7).DEADLINE
16 January 2026- Consultation close for all other proposals, including PRA-FCA joint changes; responses to cp25-33@fca.org.uk.
February 2026- FCA publishes feedback and rules on targeted support in Handbook Notice.
March 2026- FCA publishes feedback and rules on all other proposals (including Chapter 4) in Handbook Notice; Spring fee-rates consultation.
April 2026- PRA publishes feedback and rules on Chapter 4; changes effective for 2026/27 fee year (April-March).
Compliance Impact
Urgency: High – Firms must act imminently on consultation responses (deadlines passed as of today, but feedback analysis pending March/April 2026 rules) to influence outcomes; changes affect 2026/27 budgets starting April, with cash flow risks from invoice timing and new fees for emerging activities like PISCES/DPC. Non-engagement risks unbudgeted costs and procedural breaches (e.g., overdue invoices).
This was the first meeting of the Market Participants Group (MPG), a senior-level forum for financial market participants to share their views on relevant themes and narratives in financial markets with members of the Bank of England’s Monetary Policy Committee.
The PRA's PS22/25 finalizes an increase in the retail deposits threshold for the leverage ratio requirement from £50 billion to £75 billion, introducing a three-year averaging mechanism for calculations, effective 1 January 2026. This adjustment reflects nominal UK GDP growth since 2016 to maintain the Financial Policy Committee's original risk appetite while smoothing cliff-edge effects for firms like building societies. It matters for major UK banks and similar firms as it alters capital planning and leverage ratio applicability, potentially reducing immediate compliance burdens for those nearing the old threshold.
What Changed
Retail deposits threshold raised from £50 billion to £75 billion, adjusted upward from the CP2/25 proposal of £70 billion to account for further GDP growth to Q2 2025 (rounded to nearest £5 billion).
Introduction of a three-year moving average for calculating retail deposits metric, replacing point-in-time values to mitigate volatility and aid capital planning, particularly for building societies.
Non-UK assets threshold remains unchanged at £10 billion.
Modifications by consent disapplying leverage ratio rules during review will cease on 30 June 2026.
These changes are implemented via...
What You Need To Do
Review and update internal retail deposits calculations to incorporate three-year moving average methodology starting 1 January 2026
Assess current and projected retail deposits against £75 billion threshold (and £10 billion non-UK assets) to determine leverage ratio applicability and adjust capital planning accordingly
Prepare to meet 3
For firms with modifications by consent
Update governance, risk models, and board reporting to reflect changes; conduct gap analysis against PRA Rulebook appendices in PS22/25
Key Dates
5 March 2025- PRA publishes Consultation Paper CP2/25 proposing £70 billion threshold.
5 June 2025- Consultation response deadline.DEADLINE
12 November 2025- PRA issues PS22/25 with final policy.
1 January 2026- Final policy takes effect, applying new £75 billion threshold and three-year averaging.
30 June 2026- Cessation of modifications by consent disapplying leverage ratio rules.
Compliance Impact
Urgency: High – With effectiveness just after today (1 January 2026), firms near £50-75 billion in retail deposits face immediate recalibration of leverage exposures and capital buffers to avoid breaches, amplified by the shift to averaging which requires historical data reconstruction. Non-compliance risks PRA enforcement, heightened scrutiny, or capital inadequacy findings, but the higher threshold and averaging provide planning relief versus the status quo.
The Bank of England (the Bank) has today published a consultation paper (CP) setting out its proposed regulatory regime for sterling-denominated systemic stablecoins.
AI Analysis
The Bank of England has published a consultation paper (issued November 10, 2025) proposing a comprehensive regulatory regime for **sterling-denominated systemic stablecoins**, establishing requirements for backing assets, capital, redemption procedures, and operational safeguards. This represents a pivotal step toward implementing the UK's stablecoin framework, with the regime designed to maintain financial stability while enabling viable business models for systemic stablecoin issuers.
What Changed
The proposed regulatory regime introduces several material requirements for systemic stablecoin issuers:
*Backing Asset Composition
Systemic stablecoin issuers will be permitted to hold up to 60% of backing assets in short-term sterling-denominated UK government debt, with the remaining 40% held as deposits at the Bank of England.
What You Need To Do
*For Systemic Stablecoin Issuers
*Monitor and respond to consultation - Submit detailed comments on proposals before February 2026 deadline, particularly on:
Alternative tools to achieve regulatory objectives
Backing asset composition and holding limits
Safeguarding regime design
Key Dates
November 10, 2025- Bank of England published consultation paper on proposed regulatory regime
February 2026- Consultation deadline (industry to submit comments)DEADLINE
2026- Expected implementation of UK stablecoin regime (timeline subject to consultation outcomes)
Further consultation expected- On detailed design of safeguarding regime and central bank liquidity arrangements
**PS20/25** represents the second and final phase of the PRA's "Strong and Simple Framework," establishing a significantly simplified capital regime for Small Domestic Deposit Takers (SDDTs) while maintaining their resilience. This near-final policy statement, published on 28 October 2025, fundamentally restructures capital requirements, liquidity rules, and operational frameworks for SDDTs—a critical development for smaller deposit-taking institutions seeking regulatory relief from disproportionate compliance burdens.
What Changed
The simplified capital regime introduces structural changes across all three pillars of capital requirements:
*Pillar 1 (Risk-Weighted Assets)
SDDTs must apply Basel 3.1 standardised approaches for credit risk and operational risk, with specific simplifications.
Due diligence requirements in the standardised approach to credit risk are disapplied for SDDTs.
Counterparty credit risk (CCR) for derivatives and credit valuation adjustment (CVA) risk are disapplied (with minor exceptions).
Market risk framework is simplified, with SDDTs applying the credit risk approach to trading book positions...
What You Need To Do
*For SDDTs Currently Operating or Considering Entry:
*Notification Decision – Determine whether to enter the SDDT regime and submit notification to the PRA by 31 March 2026 if seeking to benefit from simplified rules
*Policy Review – Conduct comprehensive review of PS20/25, related policy statements (PS18/25, PS19/25, PS8/25, PS14/25), and supporting methodologies (SoP5/25, SS4/25, amendments to SoP2/23)
*Capital Calculation Transition – Prepare systems and processes to transition from current capital calculation methodologies to Basel 3
Removal of CCR and CVA calculations for derivatives
Key Dates
31 March 2026– Deadline for firms wishing to enter the SDDT regime to notify the PRA and benefit from the simplified framework at implementation.DEADLINE
1 January 2027– Implementation date for the simplified capital regime for SDDTs; the Interim Capital Regime will no longer apply.
2026 (specific date TBD)– PRA to make final rules and policy covering the entire Basel 3.1 package once HM Treasury makes commencement regulations to revoke relevant CRR provisions.
2027 (specific date TBD)– PRA to implement restatement of CRR requirements (PS19/25).
Publication from the Bank, PRA and FCA to firms and financial market infrastructures highlighting observed effective practices of cyber response and recovery capabilities.
The Bank of England chairs the London Foreign Exchange Joint Standing Committee (FXJSC), which is a forum for discussion of the wholesale foreign exchange market. The FXJSC is made up of market participants, infrastructure providers and the UK financial regulators.
The Bank of England chairs the London Foreign Exchange Joint Standing Committee (FXJSC) Legal Sub-Committee. The FXJSC is made up of market participants, infrastructure providers and the UK financial regulators.
The Bank of England chairs the London Foreign Exchange Joint Standing Committee (FXJSC) Operations Sub-Committee. The FXJSC is made up of market participants, infrastructure providers and the UK financial regulators.