The Competition and Markets Authority (CMA) published its provisional decision that the remaining provisions of the SME Banking (Behavioural) Undertakings 2002 (the 'Limitation on Bundling Provisions') are no longer appropriate and should be released. The Limitation on Bundling Provisions prevent the banks that gave the undertakings from requiring, as a condition of granting a business loan or approving the opening of a business deposit account, that a small or medium-sized enterprise (SME) customer should open or maintain a business current account with the bank. The proposed release is due to changes in the competitive landscape in the SME banking markets and changes in customer behaviour, and the decision follows the CMA's review of the undertakings earlier this year. The CMA is now consulting on this provisional decision before it makes its final decision. The deadline for comments is 5pm on 3 September.

The UK's House of Lords Financial Services Regulation Committee (the Committee) published its letter to the FCA, expressing concern and requests for further information in relation to the FCA's motor finance redress proposals. The letter is in response to Nikhil Rathi's letter (also published) to The Rt Hon. the Lord Forsyth of Drumlean PC KT, Chair of the Committee, dated 4 August which followed the UK Supreme Court's decision in the cases of Hopcraft, Johnson, and Wrench. The Committee requests more information about: i) the legal grounding which underpins the FCA's proposals to limit the scheme to agreements dating back to 2007 rather than aligning the scope with the six year limitation period for bringing a claim for breach of the Consumer Credit Act; ii) the FCA's modelling of indicative costs to industry; iii) administrative costs to firms and how the FCA intends to ensure these are proportionate to the amount of redress paid; and iv) the likely impact of the redress scheme on the integrity of the motor finance market in the UK. The Committee notes the importance of the motor finance market to consumers and requests the FCA to appear before it in September to respond to the concerns raised.

The UK Financial Ombudsman Service (FOS) published its Q1 2025/26 complaints data alongside a press release, revealing a notable decline in case volumes to 68,000, down from 74,600 in the same period last year. Complaints about motor finance commission dropped significantly from 36,000 in the last three months of 2024/25 to 21,500 processed in the first three months of this year, while irresponsible lending cases halved to 10,000 compared to the same period last year. Fraud and scam complaints also fell, with 6,800 cases reported, including 3,400 in relation to authorised push payment fraud. The introduction of charges for professional representatives submitting over ten complaints annually, which entered into force on 1 April, has led to a reduction in such cases, from 36,600 to 30,800. The FOS is working with HM Treasury and the UK Financial Conduct Authority to modernise the UK's redress system, aiming to improve efficiency, encourage early resolution and ensure complaints are well-evidenced before investigation. These reforms, which include changes to complaint processing and industry guidance on mass redress triggers, are subject to consultation until 8 October.

The UK Financial Conduct Authority (FCA) has published a letter dated 31 July, addressed to claims management companies (CMCs) involved with motor finance claims, urging them to review their financial promotions to ensure compliance with the FCA Handbook and standards set out under the Consumer Duty. The FCA has seen an increase in activity with CMC firms. From 1 January 2024 to 30 June 2025, the FCA's engagement with 14 authorised CMCs specialising in motor finance claims has resulted in 225 financial promotions being amended/withdrawn. The letter sets out the FCA's concerns regarding financial promotions across a range of media platforms, including websites, social media, banner advertisements and paid Google ads, that may breach the requirements set out in the Claims Management: Conduct of Business sourcebook (CMCOB) and the Consumer Duty.

Read more.

The UK Financial Conduct Authority (FCA) has issued a statement alongside a press release confirming its intention to consult on a motor finance redress scheme for consumers affected by unfair commission arrangements. This follows the UK Supreme Court's ruling on 1 August. The FCA states that its aim is to create a redress scheme which is fair and easy for consumers to participate in, so there is no need to use a claims management company or law firm. In its statement, the FCA confirms that the consultation, expected in early October, will consider the following topics as set out below.

Read more.

The UK Financial Conduct Authority (FCA) has announced that effective from 8 October, retail consumers will be permitted to access crypto exchange traded notes (cETNs), marking a significant shift from the current ban. This move is the latest step in the FCA's evolving approach to establishing a regulatory framework for crypto, in line with its crypto roadmap. To ensure investor protection, cETNs must be traded exclusively on an FCA-approved, UK-based Recognised Investment Exchange (RIE). Firms offering these products will be subject to financial promotion rules to avoid offering consumers inappropriate incentives to invest and to ensure consumers are provided with the right information. While the consumer duty will apply to firms offering these products to retail investors, the FCA clarifies that there will not be coverage from the Financial Services Compensation Scheme. Consumers should therefore ensure they understand the risks before deciding to invest. The existing ban on cryptoasset derivatives for retail clients remains in force.

The UK Supreme Court has handed down its judgment on the conjoined appeals involving two lenders who challenged the decision of the Court of Appeal that a car finance broker could not lawfully receive a lender's commission without first obtaining the customer's fully informed consent to the deal. In its judgment, the Supreme Court largely overturns this decision, deciding that lenders who financed the car loans were not liable to their customers for bribery for failing to obtain their informed consent to commission payments made by the lenders to the dealers arranging the finance. However, in relation to one customer liability did arise on the basis there was an unfair relationship between the customer and lender for the purposes of the Consumer Credit Act 1974. For further detail on the judgment, you may like to read our article "Commission not impossible: no bribery or breach of fiduciary duty in failure to disclose car finance commission". On the same day, the UK Financial Conduct Authority (FCA) issued a statement in response to the Supreme Court's judgment. The FCA acknowledged the significance of the ruling and confirmed it would provide further clarity regarding a potential redress scheme, which it then published on 3 August.

The UK Financial Conduct Authority (FCA) has published the findings from its review on digital design in customers' online journeys when accessing consumer credit, with related press release, identifying good practices and areas for improvement. Although the findings relate to consumer credit providers, other firms with a digital presence may find the examples of good and poor practice useful. The FCA found that some firms' digital design supported good consumer outcomes, such as using simplified language and offering explainer videos. Other firms had less well-designed digital platforms. A particular issue was a lack of "positive friction", meaning consumers were driven towards making quick decisions that did not align with their best interests.

Read more.

The UK Solicitors Regulation Authority and the UK Financial Conduct Authority (FCA) have issued a joint warning addressed to law firms and claims management companies (CMCs) over poor practices in motor finance commission claims. The warning comes ahead of the pending Supreme Court judgement, expected on 1 August, which, if upheld could expose firms to significant liability for failing to disclose commissions. The FCA has confirmed it will likely consult on a free motor finance redress scheme for affected consumers. The joint warning sets out expectations for law firms and CMCs, including that they inform clients of the existence, or a potential introduction, of a free redress scheme before entering into agreements with consumers, even if the scheme has not yet been confirmed. A decision on a potential FCA-led redress scheme is expected within six weeks of the Supreme Court's judgment.

The UK government has announced the signing of a Free Trade Agreement (FTA) with India, agreed in May this year. According to the government’s press release, for financial and professional services the deal provides locked-in market access and legal certainty and ensures UK firms are treated on par with domestic suppliers. Separately, the UK government has also renewed the Comprehensive and Strategic Partnership with India, enhancing cooperation on defence, education, climate and technology. Both countries also agreed to strengthen collaboration in tackling serious fraud, organised crime and illegal migration. This includes agreeing to finalise a new criminal records sharing agreement to support proceedings, maintain accurate watchlists and enforce travel bans.

The UK Financial Conduct Authority (FCA) has published final policy statement PS25/11, accompanied by a press release, finalising the first set of reforms under the Mortgage Rule Review (MRR). These changes aim to simplify mortgage lending rules and increase flexibility for consumers, in line with the FCA's five-year strategy to support sustainable home ownership and improve consumer outcomes. Following the May consultation, the FCA confirms it will proceed with a majority of the proposed changes as consulted on, with minor amendments in response to feedback. The FCA confirms that it is retiring two pieces of non-Handbook guidance (FG13/7 and FG24/2) and implementing rule changes that streamline the mortgage advice process.

Read more.

The Cost Benefit Analysis (CBA) Panel has issued a statement in response to the UK Financial Conduct Authority's (FCA) consultation paper on proposed rules to regulate Deferred Payment Credit (DPC) products, commonly known as Buy Now Pay Later (BNPL), following the UK government's decision to bring DPC within the FCA's remit. The CBA Panel welcomes the FCA's rationale and use of data but raises concerns about the clarity and robustness of the accompanying CBA. It makes a series of high-level recommendations, which include clearer articulation of the relationship between the FCA's CBA and HM Treasury's impact assessment as referred to in the consultation, more detailed analysis of alternative policy options and a reassessment of the cost and benefit estimates to ensure a balanced view. The CBA Panel also calls for a simplified and improved presentation, recommending that an executive summary be included to lay out the questions which the CBA sets out to answer, its main lines of analysis and its conclusions.

The UK Financial Conduct Authority (FCA) has published consultation paper CP25/23, alongside a press release and new webpage, setting out its proposed rules for regulating Deferred Payment Credit (DPC), commonly known as Buy Now Pay Later (BNPL). In the paper, the FCA uses "DPC" to refer specifically to the interest-free, short-term credit products. The deadline for comments on the FCA's consultation is 26 September, with a final policy statement expected in early 2026. The rules will apply from 15 July 2026.

The Financial Services and Markets Act 2000 (Regulated Activities etc.) (Amendment) Order 2025 brings interest-free BNPL agreements within the regulatory perimeter. This means that from 15 July 2026, third-party lenders offering DPC must be FCA-authorised or hold temporary permission under the temporary permissions regime (TPR). The TPR allows firms to continue operating while the FCA assesses their applications. Firms without authorisation or temporary permission must cease regulated DPC activity but may continue servicing DPC agreements entered into before that date. Merchants offering DPC directly will remain outside the regulatory perimeter and will not require authorisation.

Read more.

HM Treasury (HMT) has published a draft statutory instrument (SI) and policy note on providing targeted support. The draft SI amends the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 by specifying a new regulated activity of targeted support, which is not investment advice, but which constitutes the provision of a recommendation to an individual on the basis of a group with whom the individual shares similar characteristics and/or similar circumstances. The publications follow the UK Financial Conduct Authority's (FCA) June consultation paper on proposals for targeted support and are part of the joint undertaking between HMT and the FCA on the Advice Guidance Boundary Review—which in turn forms part of the broader UK Financial Services Growth and Competitiveness Strategy aim of unlocking retail investment. The policy note confirms HMT's intention to legislate this year. The deadline for comments is 29 August.

The UK Financial Ombudsman Service (FOS) has published a final policy statement and accompanying press release, confirming that the FOS is changing the interest rate applied to compensation awards to a time-weighted average of the Bank of England base rate plus one percentage point, applied on a simple basis. This change is being made as a result of feedback to the joint FOS and UK Financial Conduct Authority call for input published in June, which conveyed the view that the 8% interest rate does not reflect prevailing market conditions. This change will not impact complainants able to demonstrate actual loss (where the loss is considered in the primary compensation award) nor late payments (i.e. payment made after the deadline date set by the FOS for paying compensation, where the 8% interest rate is being retained in respect of the post-determination period). The FOS is aiming to implement the changes as of 1 January 2026 but will confirm the date in due course. The FOS also confirms that it has taken on board industry feedback on the potential complexity of having dual rates and will be developing and implementing calculators for both the existing and new rates, plus guidance, which will be developed in advance of the implementation date.

HM Treasury (HMT) has published a consultation paper setting out proposed reforms to the UK Financial Ombudsman Service (FOS), in tandem with the joint UK Financial Conduct Authority and FOS consultation paper (CP25/22) on modernising the financial redress system (with accompanying press release). The consultations were also announced by the Chancellor of the Exchequer in her speech delivered at Mansion House on 15 July, where she referred to the delivery of the most significant reform to the FOS since its inception.

Read more.

HM Treasury has announced the launch of a permanent mortgage guarantee scheme, aimed at supporting first-time buyers and home movers across the UK. The scheme enables access to 91–95% loan-to-value mortgages, allowing buyers to purchase a home with deposits as low as 5%. Effective from July, the scheme provides participating lenders with a government-backed guarantee, insuring them against a portion of potential losses on those qualifying mortgages. The scheme rules, published on the same day, set out the eligibility criteria, lender obligations and terms under which the government guarantee applies. The announcement accords with other significant mortgage market developments as referred to in the Chancellor's Mansion House speech, including the Financial Policy Committee's announcement regarding the loan-to-income limit on mortgage lending which the UK regulators are implementing.

The UK statutory instrument (The Financial Services and Markets Act 2000 (Regulated Activities etc.) (Amendment) Order 2025) implementing the necessary legislative changes for progressing buy-now, pay-later (BNPL) regulation was made, accompanied by an explanatory memorandum. The draft secondary legislation was originally laid in May alongside HM Treasury's (HMT) response to its 2024 consultation. The instrument brings interest-free BNPL agreements within the regulatory perimeter by amending the scope of agreements which are capable of being "exempt agreements" under article 60F of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001. In addition, it provides a carve-out from the regulated activity of credit broking for merchants offering BNPL agreements except in the case of domestic premises suppliers.

The instrument came into force on 15 July for certain limited purposes, including to enable the UK Financial Conduct Authority and the UK Financial Ombudsman to make rules and give guidance in relation to the changes. For other purposes, the instrument comes into force on 15 July 2026 which is in line with the expected timetable for BNPL regulation. You may also like to read our client bulletin, Buy-Now, Pay Later – The Journey Continues (and the end is nearly in sight) for further detail on HMT's response to the 2024 consultation on BNPL products.

The European Securities and Markets Authority (ESMA) has issued a public statement addressed to crypto-asset service providers (CASPs) that offer both regulated and unregulated services under the Markets in Crypto-Assets Regulation (MiCAR). ESMA calls on CASPs to avoid creating investor confusion about the regulatory protections that apply to unregulated products and services. To address this risk, ESMA reminds CASPs of their obligation to act fairly, professionally and in the best interests of their clients, to avoid any conduct that can mislead or confuse them. In the statement, ESMA also cautions against CASPs using their regulated status as a marketing tool to promote unregulated services, as this can further contribute to investor misunderstanding. To mitigate these risks, ESMA encourages CASPs to adopt all necessary measures and provides a practical table of "dos and don'ts". This includes measures such as maintaining clear and effective communication with clients at every stage of the sales process, ensuring marketing materials are fair, clear and not misleading and disclosing the absence of MiCAR protections for unregulated services, among others.

The European Banking Authority (EBA) has published a consultation paper on proposed revisions to its product oversight and governance (POG) guidelines for retail banking products. The EBA considers the update necessary in light of its June 2024 greenwashing report, which identified growing risks across the financial sector and to align with recent legislative amendments to the Capital Requirements Directive (CRD) and Capital Requirements Regulation (CRR) concerning Environmental Social Governance (ESG) risk management.

The revised guidelines aim to strengthen safeguards against greenwashing and ensure that financial institutions maintain high standards of conduct when offering products with ESG features. The EBA proposes a proportionate and targeted approach, adjusting a limited set of existing requirements related to the product's subject matter, manufacturers internal controls, the target market, distribution channels and information flows for the manufacturer's arrangements. A small number of consequential updates are also proposed. The deadline for comments on the consultation is 9 October, with the final guidelines expected to be published in Q1 2026 and effective from 1 December 2026. A virtual public hearing is scheduled for 11 September.

The Financial Ombudsman Service (FOS) has published its annual report and accounts for 2024/25, accompanied by a press release. The report highlights a 54% year-on-year increase in complaints, with 305,726 new cases received, the highest volume since the PPI issue in 2018/19. The significant increase is driven primarily by complaints concerning motor finance commission (73,328 cases) and unaffordable lending (71,685 cases), alongside notable increases in fraud and scams. Around half of all complaints were submitted by professional representatives, a sharp increase from 25% the previous year. On average, across all financial products, the FOS upheld 34% of the complaints it resolved, compared to 37% in 2023/24. In response to operational pressures, the FOS confirms it is expanding its workforce, modernising its structure and investing in digital transformation.

The UK Financial Conduct Authority (FCA) has published a consultation paper CP25/17 (CP) accompanied by a press release and updated webpage, proposing a new regulatory framework for "targeted support" in pensions and retail investments. The CP forms part of the Advice Guidance Boundary Review and the FCA's five-year strategy to support growth and help consumers navigate their financial lives. The deadline for comments is 29 August and a policy statement is expected by the end of the year, subject to the volume of feedback received.

The CP proposes the introduction of a new regulated activity of targeted support, which would allow firms to provide ready-made suggestions on investment products or courses of action to groups of consumers with common characteristics, making it clear that such support does not constitute fully personalised financial advice. The UK Government has announced that it will consult on amending the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 accordingly to introduce the new regulated activity. A draft statutory instrument is expected to be published alongside the Mansion House speech on 15 July. The targeted support framework would not impact the existing regulatory framework for activities that can currently be delivered as guidance without FCA authorisation.

Read more.

The UK Financial Conduct Authority (FCA) has published discussion paper DP25/2 (DP) accompanied by an updated webpage and press release, on the future of the UK mortgage market, as part of its ongoing mortgage rule review. The DP forms part of the FCA's five-year strategy to rebalance risk, support growth and help consumers navigate their financial lives. It outlines potential reforms to improve access to sustainable home ownership, support responsible lending and encourage market innovation.

Read more.

The Financial Action Task Force (FATF) has published revised standards and an accompanying explanatory note, updating its comprehensive framework on recommendations to strengthen global efforts in anti-money laundering, counter-terrorist financing and counter-proliferation financing, as announced during the joint FATF-MONEYVAL Plenary meeting. The FATF update includes amendments to Recommendation 16, which governs the transparency of wire transfers through the payment chain and is commonly referred to as the "Travel Rule. The revised recommendation is aimed to modernise FATF standards in response to the evolving payments landscape, which now includes a broader range of products and services, technologies and business models.

Read more.

HM Treasury has published a policy paper setting out an update to its final position to its 2024 consultation on regulating Buy-Now, Pay-Later (BNPL) products which led to the laying of the draft secondary legislation, The Financial Services and Markets Act 2000 (Regulated Activities etc) (Amendment) Order 2025. Under the draft regulation, domestic premises suppliers (DPS merchants), which are businesses who sell, offer to sell or agree to sell goods or offer to supply or contract to supply services in people's homes, are required to seek credit broking permissions to offer BNPL products as a payment option. However, in response to industry feedback, the UK Government has concluded that this requirement may have a disproportionate impact for small businesses and will potentially reduce consumer choice. Consequently, an amending negative statutory instrument to coincide with the BNPL regulation, will be laid to remove this requirement, while maintaining key consumer protections. These include: (i) BNPL lenders will be required to conduct affordability and creditworthiness checks before consumers can use the product; (ii) consumers will be able to raise complaints through the Financial Ombudsman Service and access protections under section 75 of the Consumer Credit Act; and (iii) BNPL lenders authorised by the UK Financial Conduct Authority (FCA) will be expected to comply with Consumer Duty rules, including regular monitoring and review of consumer outcomes. BNPL firms will also be expected to exercise greater oversight of the merchants using their services—including DPS merchants. The UK government and the FCA will continue to monitor the BNPL market and will take any action, if required, to prevent consumer harm.

The House of Lords Financial Services Regulation Committee (the Committee) has published a report, alongside a press release, evaluating the progress made by the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) in supporting growth in the financial services sector and the wider UK economy. The Financial Services and Markets Act 2023 introduced a secondary objective for the regulators focused on international competitiveness and growth. While the Committee acknowledges that this objective has encouraged regulators to consider the broader impact of their actions, it also finds a prevailing culture of risk aversion by the regulators which undermines the objective. It states this contributes to persistent barriers that limit firms' ability to grow, innovate and compete.

The UK Financial Conduct Authority (FCA) has published an article with findings from a thematic review assessing firms who provide retirement income advice (RIA). The review assessed how effectively firms are providing RIA and the quality of outcomes for consumers entering decumulation, the phase when individuals begin drawing income from their pension savings.

The FCA has identified three key areas as crucial for achieving good client outcomes:

• Information collection and record keeping by firms. Firms are expected to gather comprehensive and relevant client information to assess suitability before making recommendations and maintain clear, up-to-date records. While most firms showed a good understanding of clients' objectives and circumstances, several failed to adequately document or collect key information in client files.

Read more.

The UK Financial Conduct Authority (FCA) has launched the investment advice assessment tool (IAAT) to help personal investment firms assess the suitability of their investment advice and disclosures to consumers (excluding advice on retirement income or defined benefit transfer advice). The IAAT offers a structured methodology for reviewing past advice provided since 3 January 2018, including in response to business complaints or as part of a past business review. The tool is intended not only for the use of investment firms but also professional indemnity insurance providers, compliance or legal consultants and trustees of defined contribution pension schemes. Use of the IAAT is subject to the FCA's licensing agreement, which must be reviewed before access or use. To support firms, the FCA has also published an instruction guide explaining how to use the IAAT and interpret the results of file reviews conducted by the FCA.

The European Commission (EC) has issued a call for evidence to gather input on its initiative to develop a European blueprint for savings and investment accounts as part of its recommendation for the savings and investments union (SIU). The initiative aims to encourage retail investors to participate more actively in EU capital markets, aiming to boost long-term returns on their savings while simultaneously enhancing market liquidity and increasing the flow of capital to European businesses. The SIU Communication has emphasised the importance of savings and investment accounts to be based on best practices, with effective models described as being user-friendly, digitally accessible, providing access to a wide range of investment products, offering favourable tax treatment and/or simplified tax compliance, and allowing low or no-cost provider switching. The EC is specifically seeking feedback on these characteristics, as well as their benefits and limitations, to assess their effectiveness in making savings and investment accounts an easy and convenient entry point to capital markets for retail investors pursuing investment opportunities for their savings. The deadline for comments is 8 July, with the recommendation expected to be published in Q3 2025.

The UK Financial Conduct Authority (FCA) has published quarterly consultation paper No 48, accompanied by a press release, inviting feedback on proposed amendments to its Handbook. Key proposals include:

• Amending guidance in SUP 6.4 to reflect legislative changes introduced in section 415AA of the Financial Services and Markets Act 2000 (FSMA); the deadline for comments is 14 July.
• Streamlining data reporting by decommissioning certain requirements, including changes to REP009 (consumer buy-to-let mortgage aggregated data) reporting frequency and removing nil return requirements for REP008 (notification of disciplinary actions relating to conduct rules staff other than SMF managers); the deadline for comments is 30 June.

Read more.

The UK Financial Conduct Authority (FCA) has published a statement outlining key considerations for a potential consumer redress scheme, as part of its review into motor finance commission arrangements, following the pending Supreme Court judgement, expected in July. If upheld, the ruling could expose firms to significant liability for failing to disclose commissions.

Read more.

The Financial Ombudsman Service (FOS) has published a consultation paper seeking views on the interest rates applied to compensation awards. This follows concerns raised in response to a 2024 joint call for input with the UK Financial Conduct Authority, that the current rate of 8% discretionary interest on top of compensation awards is excessively high.

The consultation paper invites feedback on whether the current 8% interest rate should be: (i) maintained at its current level of 8%; (ii) reduced, with respondents to suggest alternative rates and the rationale behind them; (iii) replaced with a tracker rate linked to the Bank of England (BoE) base rate plus 1%, where the base rate is calculated as an average rate over the period that the money was due until the date redress payment is made (FOS's recommended option); or (iv) replaced with a tracker rate linked to the BoE base rate plus 1%, but where the base rate is calculated as the rate at the point of determination of the complaint. FOS also sets out options for implementation, with its preferred approach to apply the new rate to complaints referred from the date the change takes effect.

In addition, FOS is seeking views on the types of exceptional circumstances where it may be appropriate for an ombudsman to ask a firm not to apply interest e.g., by choosing not to award interest for a certain period to reflect a firm's unreasonable conduct that caused delays during the investigation. In such cases, the ombudsman will be required to clearly explain the reasons for departing from the standard rate. The consultation focuses on pre-and-post determination interests, it does not address any other awards an ombudsman may recommend when making a decision. The deadline for comments on the consultation paper is 2 July. FOS aims to publish a policy statement in September, with the intention of implementing any changes as soon as possible thereafter.

The European Securities and Markets Authority (ESMA) has issued written letters to several major social media and platform companies—including X, Meta, TikTok, Alphabet, Telegram, Snap, Amazon, Apple, Google and Reddit—urging them to take proactive steps against the promotion of unauthorised financial services on their platforms. ESMA suggests that this could be achieved by these companies checking ESMA's register of MiFID investment firms. This initiative seeks to combat the rising number of online scams targeting retail investors, which mislead consumers into engaging with unlicensed firms, resulting in financial losses and lack of trust in the wider financial sector and with digital platforms. ESMA's action is aligned with the recent initiative by the International Organization of Securities Commissions on combatting online harm, highlighting the global nature of the issue of financial misconduct in the digital environment. ESMA has also requested for meetings with these platform providers to develop a coordinated approach to retail investor protection from financial harm.

The UK Financial Conduct Authority (FCA) has published Handbook Notice 130, which outlines updates to the FCA Handbook, including changes for fund managers stemming from the recommendations of the Investment Research Review and feedback to consultation paper CP24/21. These changes allow fund managers to use a joint payment option to pay for investment research and execution services, subject to a set of guardrails, aligning with rules already applicable to MiFID investment firms.

Read more.

The International Organization of Securities Commissions (IOSCO) has issued a statement calling for platform providers to take stronger action against rising investment fraud, driven by increased retail investor activity on digital platforms. It encourages platform providers to leverage the IOSCO International Securities and Commodities Alerts Network (I-SCAN)—a database launched in March that identifies unlicensed firms or those engaging in illegal activities—to block, warn against or remove illegal investment offerings from their platforms. In the statement, IOSCO has also highlighted effective measures used in some jurisdictions to combat online harm involving financial misconduct, including due diligence on unauthorised offerings, rigorous enforcement of compliance with terms of service, strong processes for detecting scams and proactive engagement with financial regulators and government authorities, including referrals of fraudulent activity.

HM Treasury (HMT) has published a response to its 2024 consultation on regulating Buy-Now, Pay-Later (BNPL) products and laid the draft secondary legislation (Financial Services and Markets Act 2000 (Regulated Activities etc) (Amendment) Order 2025), to implement the proposed regime before Parliament. The consultation response is accompanied by an updated webpage and press release. The proposed regulatory framework aims to bring BNPL products under the UK Financial Conduct Authority's (FCA) oversight, ensuring consumers receive clear information, undergo affordability checks, have access to the Financial Ombudsman Service and benefit from the protections of section 75 of the Consumer Credit Act (CCA)—which imposes liability upon a creditor for breaches by a supplier—should something go wrong with their purchases.

Read more.

HM Treasury (HMT) has published Phase 1 of its two-part consultation on reforming the Consumer Credit Act 1974 (CCA), accompanied by an updated webpage. The proposals aim to modernise the CCA to better align with new financial products and technology while promoting a competitive consumer credit market which supports the growth of the UK economy. The new regime will repeal many of the CCA provisions, to be replaced with rules in the UK Financial Conduct Authority (FCA) Handbook as part of a more flexible, outcomes-based approach. Further details can be found in our client bulletin, Goodbye old friend? HM Treasury consultation on Consumer Credit Act 1974 reform.

Read more.

The European Parliament's Committee on Economic and Monetary Affairs (ECON) has published a draft report (dated 13 May) and motion for a European Parliament resolution on improving access to finance for SMEs and scale-ups. The motion for a resolution has regard to various recent European Commission (EC) communications, including on the Savings and Investment Union (SIU) and competitiveness compass, and other key publications and reports such as the Draghi report and Letta report.

Read more.

The European Commission (EC) has launched a call for evidence on fostering integration, scale and efficient supervision in the single market as part of its savings and investments union (SIU) strategy. The SIU is a key initiative to improve the way the EU financial system channels savings to productive investments. It seeks to offer EU citizens broader access to capital markets and better financing options for companies, to foster citizens' wealth, while boosting EU economic growth and competitiveness.

Read more.

The UK Financial Conduct Authority (FCA) has issued a final policy statement (PS25/3) on consumer credit regulatory returns, published together with an updated webpage. The FCA is introducing a new regulatory return for consumer credit firms engaging in one or more of the regulated activities of credit broking, debt adjusting, debt counselling services and providing credit information services. The rules were previously consulted on in September 2024 in CP24/19 (for further background on this, please see our update). The return aims to collect tailored data on firms' operations, consumer engagement and use of permissions to allow the FCA to achieve its strategic objectives and be more efficient and effective in regulating the sector. The feedback to the consultation was largely positive. Most comments focussed on the scope of the data elements and clarifying the FCA's expectations. In response to the feedback, the FCA has reduced the number of questions in the return by 27% and has made changes to the rules making them clearer and more effective. This includes: (i) removing questions requiring data from lenders; (ii) changing the data required from credit brokers from successful applications to total introductions; and (iii) allowing firms to annualise data for the first reporting period if they do not have all the required data for the whole year. The FCA intends to review and replace returns for firms undertaking other consumer credit activities but will be delaying the implementation of remaining phases. This will reduce the burden on firms and give the FCA time to assess the impact and value of the new return, together with the three new product sales data returns which have already been introduced.

The UK Financial Conduct Authority (FCA) has published a consultation paper (CP25/11) on simplifying its rules on mortgage lending and increasing flexibility, with an updated webpage and press release. This is the first set of proposals made through the Mortgage Rule Review (MRR), and forms part of the FCA's 5-year strategy. The FCA is proposing to amend its mortgage advice and selling standards, and its affordability rules for mortgage term reductions and remortgaging. The FCA also proposes to retire two pieces of non-handbook guidance (FG13/7 and FG24/2). Broadly, the proposals seek to make mortgage regulation simpler; reducing the different sources firms have to check to understand the regulatory expectations; and will streamline processes, reduce costs and promote competition. For consumers, it is hoped that the changes will make it easier to: (i) engage with mortgage providers; (ii) reduce mortgage terms, lowering the total cost of borrowing and reducing the balance of mortgage debt taken into later life; and (iii) access the cheapest products available when remortgaging. The deadline for comments is 4 June and the FCA aims to publish its policy statement in Q3 2025. In addition, the FCA plans to launch a public discussion on the future of the mortgage market in June, covering: (i) risk appetite and responsible risk taking; (ii) alternative affordability testing and product innovation; (iii) lending into later life; and (iv) consumer information needs.

The Joint Committee of the European Supervisory Authorities (ESAs) has updated its consolidated Q&A on the EU packaged retail and insurance-based investment products (PRIIPs) key information document. The consolidated document combines responses given by the European Commission in relation to interpretation of Union law with responses given by the ESAs in relation to the application or implementation of the PRIIPs legislation. The Q&A take into account amendments to the legislation made by Commission Delegated Regulation (EU) 2021/2268. The consolidated Q&A also includes three new Q&As as of 5 May, which relate to: (i) MRM class determination; (ii) performance scenarios; and (iii) calculation of the summary cost indicators.

The UK Financial Conduct Authority (FCA) has published a consultation paper together with a related press release and webpage setting out further proposals on product information for Consumer Composite Investments (CCIs). The consultation paper follows the FCA's December 2024 consultation paper on a new product information framework for CCIs, which closed on 20 March.

The regime will apply in respect of a CCI which is or may be distributed to a retail investor in the UK and seeks to help consumers understand the products they are buying while giving firms flexibility to innovate. The proposals include: (i) removal of the requirement for firms to calculate and disclose implicit transaction costs as part of their CCI cost disclosures; (ii) alignment for CCI products of the pre- and post-sale cost disclosure requirements under the FCA Handbook Conduct of Business (COBS) rules derived from the MiFID Org Reg, to ensure no duplication or conflict in respect of investments within the scope of the CCI rules; (iii) proposed drafting on transitional provisions granting firms flexibility to move across to the new CCI regime when they are ready; and (iv) proposed consequential amendments to the FCA Handbook.

The CCI regime will replace the onshored Packaged Retail and Insurance-Based Investment Products regime. Responses to the consultation paper should be submitted by 28 May 2025.

The Financial Services Regulatory Initiatives Forum (the Forum) has published the Regulatory Initiatives Forum Grid (the Grid), with the UK Financial Conduct Authority (FCA) also updating its webpage. The previous Grid was due to be published in May 2024 but was postponed due to the General Election, meaning the Forum published only an interim update in October 2024.

The 2025 Grid sets out the regulatory pipeline for the next 24 months and reflects the reprioritisation that has taken place since the new government came into power. Notable initiatives include:

• motor finance commission review: the FCA intends to confirm, within six weeks of the Supreme Court's decision on past use of discretionary commission arrangements by motor finance firms, whether it will propose a redress scheme;
• liquidity risk management in funds: the FCA will consult on refined proposals regarding liquidity risk management in funds to implement FSB and IOSCO guidelines;
• Consumer Composite Investments (CCI) Regulation: the FCA published a second consultation paper on the new CCI regime on 16 April (see our update) and plans to issue a Policy Statement with final rules in late 2025;

Read more.

The UK Financial Conduct Authority (FCA) has published a webpage summarising the findings of its multi-firm review on retail banks' treatment of customers in vulnerable circumstances involving bereavement and power of attorney (PoA). The webpage is accompanied by a press release. The Consumer Duty requires firms to deliver good outcomes for all customers, including those in vulnerable circumstances. The multi-firm review makes a series of findings, including on:

• policies and procedures: the FCA calls for firms to make guidance for staff accessible and policies to be clear that staff should adapt to customers' needs and recognise when matters should be escalated.
• identifying and responding to customer needs: the FCA encourages firms to identify signs of vulnerability and seek information from consumers to address their needs. The FCA also wants firms to establish feedback loops to enable continuous improvement of staff and processes based on previous errors.

Read more.

The UK Financial Conduct Authority (FCA) has published a webpage summarising the findings from its multi-firm review of trading apps, together with a press release. The FCA notes that this is a growing sector allowing more retail investors easier access to a wider range of investments which can help to improve financial lives. Some trading apps, though, offer high-risk investments that were traditionally aimed at wholesale markets. The FCA's review made a series of findings, including on:

• business models: trading app firms operate in various ways. The FCA stresses that regulated firms must ensure they understand the Handbook's requirements for manufacturers and distributors, regardless of their business model, and that firms with overseas affiliates must clearly inform customers that their trading agreement is with the overseas entity and disclose any potential loss of asset protection.
• target markets: firms are likely to be both manufacturers of a trading app and distributors of products sold on it, and therefore should consider the relevant rules under PRIN 2A.3 and PROD 3 on the need to identify a target market for the products and services they manufacture and distribute. The FCA found some firms had not specified their target market at a sufficiently granular level and, in some cases, offered lower-risk and less complex products alongside more complex or high-risk ones.

Read more.

The UK Financial Conduct Authority (FCA) has announced the conclusion of its six-week policy sprint aimed at improving consumer investment decisions to support its key objective of supporting growth. With only 9% of UK consumers taking regulated financial advice last year, the sprint focused on developing targeted support to bridge the gap between bespoke financial advice and guidance. For the first time, the sprint tested future rules before formal consultation involving industry, consumer groups and other members of the regulatory family, such as the Financial Ombudsman Service and the Information Commissioner's Office, with its aim to accelerate final policy proposals by June. The sprint is part of the work being carried out in relation to the Advice Guidance Boundary Review and other initiatives aiming to change how consumers interact with retail investments.

The UK Financial Ombudsman Service (FOS) has published its plans and budget for 2025/2026, together with an accompanying press release. The FOS notes that there has been more uncertainty than usual over the last year, and this will continue into the next year. This is, in particular, due to the ongoing legal and regulatory developments in relation to motor finance commission complaints and the introduction of a fee for certain professional representatives, which the FOS expects will lead to a volume reduction as it will receive fewer cases without merit. In addition, the FOS expect disputed transactions cases in relation to fraud and scams to remain high, and an increase in respect of volumes of complaints in relation to authorised push payments. Despite the high level of complaints being referred, the FOS is not raising the case fees for businesses, and will be maintaining the reduced compulsory and voluntary jurisdiction levies. The FOS also confirms that it will carry out work over the course of the coming year to understand the impact of the introduction of regulatory rules in relation to deferred payment credit (previously referred to as buy now, pay later), which the FCA has said that it will consult on in the upcoming 2025/2026 period.

The UK Financial Conduct Authority (FCA) has published a consultation on proposed amendments to the Prudential Regulation Authority's (PRA) rulebook and FCA guidance on the de minimis threshold for the loan to income flow limit in mortgage lending (CP25/6). The consultation follows the UK Financial Policy Committee's recommendation in November 2024 that the threshold be raised so that the loan to income flow limit would only apply to lenders extending residential mortgages above GBP150 million (up from GBP100 million, the current threshold) per four rolling quarters. The changes proposed amend the relevant references to the GBP100m figure used in the PRA rulebook and the FCA guidance and make some other minor consequential changes. The deadline for comments is 8 May.

The UK Financial Ombudsman Service (FOS) has updated its webpage confirming that the new charging structure, which includes charges for professional representatives referring cases, now applies. The changes have been made in accordance with the two implementing instruments (FOS 2025/1 and FOS 2025/2) whose relevant provisions came into force on 1 April. The rules have been introduced to make the funding arrangements for the FOS fairer, and to encourage professional representatives – including authorised claims management companies and certain legal professionals – to give complaints more consideration before deciding to refer them to the FOS. As detailed in the policy statement published on 7 February, professional representatives can now refer up to ten cases for free each financial year. Subsequently, they will be charged £250 for each additional case but will receive £175 back in credit if the case outcome is in favour of the consumer. In terms of the charges to be paid by the firm against whom the complaint is made, if the complaint is not upheld or withdrawn, the firm's fee will be reduced to £475 instead of £650 (these figures being subject to any group charging arrangement). Individuals, families, friends, charities, and voluntary organisations who bring cases directly to the FOS will continue to be able to use their service for free.