On 16 January 2026, the Financial Conduct Authority (FCA) published a letter (dated 19 December 2025) that it had sent to trade associations regarding the process to establish a future entity for open banking.

Background

In August 2025, the FCA published Feedback Statement 25/4: Design of the Future Entity for UK open banking setting out its expectations for the role of the Future Entity (the successor to Open Banking Limited), how it will sit within the open banking ecosystem, and the next steps for its establishment.

Landmark year

The letter notes that 2026 will be a landmark year where the FCA expects to see live transactions flowing through the Variable Recurring Payments scheme in Q1, and HM Treasury will introduce legislation under the Data (use and access) Act that will grant the FCA new powers to set open banking rules, and the regulator plans to consult on new rules for the long-term regulatory framework. The FCA also wants to see industry establish a body capable of becoming the Future Entity which becomes the primary standard setting body for application programming interfaces in the UK.

Future Entity

In the letter the FCA states that to support progress toward establishing the Future Entity, it is asking industry participants to engage with the organisations referenced in the letter, as well as any others that may emerge, and to decide which option they believe should lead the next phase of work. To assist industry in coming to a view, the FCA will commission an independent consultant-led assessment of the proposals, or if industry is able to coalesce behind one proposal, an assessment of their supported proposal. The FCA anticipates that this process will begin in February. The FCA is also offering those bodies interested in leading the set-up of the Future Entity to contact it directly to arrange a one hour Q&A session ahead of the launch of the independent consultancy process.