On 23 April 2021, the FCA published a speech by its chair, Charles Randell, entitled ‘Cautious optimism for the post-pandemic world’.

Highlights in the speech include:

  • Firms must identify if consumers are trapped in a cycle of unaffordable debt and take action to break that cycle, such as forbearance, support and referral to appropriate debt advice, rather than extracting further rents from the most vulnerable. If they do not, the FCA must be ready to take strong enforcement action against both the firm and the senior managers who are accountable for product design and consumer outcomes.
  • In 2019 the FCA decided to underline four priorities for basic consumer protection: safe and accessible payments; sustainable credit; clear and safe investment choices; and fair product terms, including price. The FCA will continue to focus on them because none of these aspects of consumer financial services is yet in a satisfactory place.
  • In order to pivot to a greater focus on outcomes in a rapidly changing world, the approach of regulators and legislators needs to change. Both financial services legislation and financial regulation are full of complex detail, with statutes, statutory instruments and rulebooks that fill countless shelves. But complexity produces loopholes and opportunities for regulatory arbitrage. In order to regulate in this world, the FCA needs to be more agile and confident in using its Principles for Businesses to take action against those firms which are not doing the right thing.
  • Transforming the FCA will require the regulator to reset its approach to the Principles, including in particular the Principle that firms should treat their customers fairly. The FCA has been giving consideration to a New Consumer Duty (or Duty of Care) and it will make further announcements about this shortly.