FCA Strategy 2025–2030: What “Being a Smarter Regulator” Really Means for Firms
Key Takeaways
- Data-Led Supervision: The FCA's smarter-regulator agenda signals a more outcomes-focused, technology-enabled approach that raises expectations for governance and demonstrable controls.
- Short-Term Burden: A more data-led FCA may initially increase information requests as the regulator builds baseline datasets for ongoing monitoring.
- Longer-Term Trade-Off: If the FCA can supervise more effectively at arms length, some firms may ultimately face fewer direct interactions with supervisors.
- Scrutiny Risk: Better internal data sharing at the FCA could materially improve misreporting detection, increasing pressure on firms with weak reporting processes.
- Engagement Incentive: The strategy suggests firms that are proactive and transparent may benefit from less intensive supervisory treatment over time.
The FCA's Strategy 2025- 2030 signals a shift toward a more data-led, outcomes-focused and technology-driven regulator raising expectations for governance, transparency and demonstrable control frameworks across regulated firms.
Recently, the FCA released their Strategy 2025 2030 (Strategy) publication that provides regulatory expectations for firms. The objective is to provide firms with greater clarity to the FCA's areas of focus for the next five years. The Strategy covers a longer period of time than normal, providing greater regulatory certainty so that firms can better organise their internal priorities in line with the regulator's.
The March 2025 publication put forward a reduced number of priorities so that the FCA will have a greater impact in these chosen areas of focus. This, in turn, has communicated to the industry that they have been put on notice!
Two of the priorities will be of particular interest to Qomply's clients and wholesale market participants generally: i) the concept of the FCA being a smarter regulator; ii) the FCA's objective to support growth. We will consider the potential impact of the former in more detail in this article, with a follow-up article covering the latter.
The Strategy defines the concept of being a smarter regulator as:
[The FCA being] predictable, purposeful and proportionate. Improving our processes and embracing technology to become more efficient and effective. [..] how we work, our capabilities and technology must enable us to do more, faster[ and] we must be cost effective and proportionate, including how we collect and use data.
The FCA is open in their communication regarding their objective to be proportionate and easier for firms to engage with. The acknowledgement in understanding that firms undertake a significant burden in supplying them with data is one step closer. In the interim the FCA commits to regularly reviewing their requests to ensure they remain proportionate.
Being a smarter regulator means being data-led. Being data-led means teams within the FCA sharing data effectively to join the dots to supervise firms more efficiently. This may mean an increase in data requests from the FCA in the short term so that they can build up their data sets.
Any short-term inconvenience may be worth it in the longer term, as once the FCA has obtained the back data it requires to determine base levels for monitoring purposes, any future requests are likely to more structured and develop a business-as-usual pattern hopefully with at least an element of automation involved. If the FCA is able to use this data to supervise at arms length, this may also have the added benefit of reducing the number of interactions firms have with the regulator.
The flip side to the FCA having more data, provided it is used in a more coordinated fashion across teams, could be increased regulatory scrutiny. It is likely that should this occur, the FCA's ability to monitor and detect misreporting will be enhanced.
It is therefore imperative that firms ensure their transaction reporting data and processes are in order to avoid unwanted regulatory scrutiny. If the issuance of the FCA's first fine for transaction reporting against Infinox wasn't enough of wake-up call, then the possibility of the regulator being more effective at identifying misreporting and able to act on this should be.
The Strategy commits the FCA to adopting a more flexible approach, with less intensive supervision for firms where they are proactive and looking to do the right thing. Whilst it is early days and it will take a time for the strategy to embed, it seems as if the FCA's strategic priority to be a smarter regulator may provide some benefits to those that take the opportunity offered.
How Qomply can help
At Qomply, we help firms stay ahead of regulatory expectations by providing robust, automated solutions that enhance data quality, reporting accuracy, and operational resilience. Our solutions are designed to support firms in meeting the demands of a data-led regulator - identifying inconsistencies, reducing errors, and streamlining the end-to-end transaction reporting process. As the FCA sharpens its focus on using data more effectively, Qomply's solutions ensure that your firm is not only compliant but well-positioned to benefit from reduced supervisory burden through consistent, high-quality reporting and transparent processes.
Frequently asked questions
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It means the FCA wants to be more predictable, purposeful, proportionate, and data-led while using technology to become more efficient. The article presents that shift as a meaningful change in how firms should expect supervision to operate.
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It says the FCA may need more data requests initially to build its datasets and establish monitoring baselines. The article suggests that short-term burden could support more structured, business-as-usual supervision later.
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It could increase scrutiny by improving the FCA's ability to detect and monitor misreporting across teams. The article says better internal data-sharing inside the FCA may make transaction-reporting failures easier to spot.
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They should make sure their transaction-reporting data and processes are in order before scrutiny increases. The article says firms should treat the FCA's first fine against Infinox as a warning rather than an isolated event.
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It says proactive firms may benefit from less intensive supervision if they are seen as trying to do the right thing. The article presents that as one of the practical upside risks in the new strategy.
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