Innovation: engagement

Domestic engagement

We continue to grow our reach in the UK, both inside and outside of London and with firms of all shapes and sizes. With the continued growth of Fintech hubs outside of London, we see real potential for a further innovation in financial services.

We’re especially interested in areas where ‘Fin’ and ‘Tech’ collide; areas that have both strong financial centres and a technology presence, often backed by strong relationships with local universities.

Our engagement approach is focused on promoting the innovation suite of market facing tools and services[1], and is partly facilitated through the Innovation Advisory Group[2].

International engagement

Through engaging with international firms and regulators, Innovation supports the FCA’s competition objective by promoting the UK as a centre for innovation in financial services. It does this by:

• facilitating the entry of innovative overseas firms to the UK, thereby increasing innovation and competition in UK financial services markets
• facilitating the expansion of UK-based innovative firms into overseas markets, making them potentially more sustainable challengers in the UK
• providing a more efficient way for innovative firms to interact with regulators, helping them navigate between countries as they look to scale new idea through the Global Financial Innovation Network (GFIN).

FinTech bridges

FinTech bridges represents a bespoke agreement outlining collaboration between 2 governments, cooperation between regulatory bodies and connectivity between 2 markets and ecosystems. This framework aims to facilitate greater trade, investment and capital flows; reduce market access barriers; and enable information sharing. Bridges also provide access to a network of collaboration opportunities, practical support and guidance for firms seeking to expand between two markets.

Fintech bridges, led by the Department for International Trade and Her Majesty’s Treasury, are commonly underpinned by 3 main pillars:

• Government dialogue
• Business Engagement (trade & investment)
• Regulatory cooperation.  

Our Co-operation Agreements fall under the third pillar and therefore make an important part of FinTech Bridges. These allow for information sharing on innovation topics and may include a mechanism for the referral of innovative firms between the FCA and another regulator. Whilst all FinTech bridges have a Co-operation Agreement element, not all Co-operation Agreements are part of a Fintech Bridge.

Co-operation Agreements

In addition to our multilateral engagement through GFIN, we also collaborate closely with a number of international financial services regulators on a bilateral basis through the signing of Co-operation Agreements and frameworks.

We have signed Co-operation Agreements with overseas regulators that include a referral mechanism for innovative businesses seeking to enter the other’s market. The regulators will provide support to innovative businesses before, during and after authorisation to help reduce regulatory uncertainty and time to market. 

To qualify for the support offered by the agreement, innovator businesses in the UK and other jurisdictions need to meet the eligibility criteria of their home regulator’s Innovation equivalent. Once referred by their home regulator, and ahead of applying for authorisation to operate in the new market, they will have access to a dedicated team or contact person who will help them to understand the regulatory framework in the market they wish to join, and how it applies to them.

The Co-operation Agreements with overseas regulators also enable them to share information about financial services innovations in our respective markets, including emerging trends and regulatory issues.

If you are a UK firm who would like to use the referral mechanism, please complete the application form[3], stating the regulator you would like to be referred to.

If you are an international firm looking to set up in the UK, please email us at [email protected] to find out how we can support you.