Your guide to this week in regulation

This week, the Financial Conduct Authority (FCA) sends a clear message of its expectations of firms in supporting customers who face higher costs, including mortgage rate changes, and warns that weak outcomes may lead to supervisory and enforcement action.

More widely, the 10th Regulatory Initiatives Grid helpfully lays out the next wave of coordinated work across UK bodies.

Elsewhere, the FCA’s multi-firm review of credit rating agencies underlines how governance, controls and consistent methods can build trust in wholesale markets. And the FCA calls for a system-wide response to financial crime, with more data sharing, joint working and risk-based focus.

We conclude this week with a Call for Input on tokenisation in wholesale markets (open until 3 July 2026) with the potential to transform markets and support UK competitiveness.

FCA urges stronger customer support

The FCA has reminded firms to strengthen support for customers facing cost pressures, stressing that the Consumer Duty requires firms to put customer needs first and avoid foreseeable harm.

Firms should actively monitor outcomes and adapt as circumstances change. Key expectations include:

• Review products to ensure they still meet target market needs and do not cause harm.
• Assess fair value regularly and act where value has reduced or charges are no longer justified.
• Improve communications so customers understand risks, support options and consequences of inaction.
• Ensure support channels remain accessible, with low friction and effective escalation routes.

The FCA highlighted practical steps such as flexible payment arrangements, early engagement ahead of mortgage rate changes, and clearer signposting to debt advice.

Firms are expected to now prioritise:

• checking that current approaches remain appropriate,
• taking timely action where harm may arise, and
• evidencing how they monitor and improve outcomes.

The FCA concludes by reminding firms that supervisory and enforcement action will follow poor outcomes or weak responses.

Read more on supporting customers through challenging times

Regulatory Grid sets industry pipeline

Regulators have published the tenth edition of the Regulatory Initiatives Grid, giving firms a forward view of upcoming activity across UK authorities. The Grid, released on 19 May 2026, sets out the pipeline of initiatives to help firms plan for operational impact and prioritise resources.

The Forum behind the Grid brings together key regulators including the Bank of England, PRA, FCA and others to improve coordination and reduce duplication for firms.

Key takeaways for firms:

• regulators continue to align activity to support growth and competitiveness
• initiatives focus on financial stability, competition, innovation and consumer confidence, and
• authorities aim to streamline demands on firms through coordinated planning.

The Grid reflects ongoing collaboration across regulators, including joint work on payments and pension reform, and supports the Government’s wider financial services agenda.

Read more on Tenth edition of the Regulatory Initiatives Grid 

FCA flags CRA control weaknesses

The FCA has set out findings from its multi‑firm review of UK credit rating agencies (CRA), focusing on surveillance, methodologies and internal controls. This builds on the review from November 2025.

The regulator reinforces that ongoing surveillance is a core requirement, not a periodic exercise, with annual reviews only the minimum standard. Weak governance, inconsistent methodologies or poor controls risk undermining rating integrity and market confidence.

Key takeaways for firms include:

• Boards must oversee surveillance, controls and remediation activity actively
• methodologies must be rigorous, consistently applied and independently validated
• strong separation between analytical and commercial functions remains critical to manage conflicts, and
• firms should improve transparency and consistency in how ESG factors are assessed and disclosed.

The FCA also highlights that use of AI and models can enhance surveillance, but only with effective governance and challenge.

Firms should now review their frameworks, conduct gap analysis and implement remediation where needed, as the FCA will continue supervisory engagement and may undertake targeted reviews.

Read more on credit rating agencies multi-firm review

FCA calls for system-wide response to financial crime

The FCA has warned that financial crime is becoming more organised, technologically advanced and interconnected, posing risks to both economic stability and national security. Victims lose an average of £25,000 with proceeds flowing back into criminal enterprises funding serious crime.

Nikhil Rathi set out a clear direction of travel for firms, regulators and law enforcement: a fragmented approach is no longer sufficient.

Speaking at the FCA’s financial crime conference, key points to note include:

• Financial crime now operates through complex, cross-border networks that exploit gaps between organisations
• a system-wide response is required, based on stronger collaboration, better data sharing and wider use of technology, and
• prioritisation is critical, as the scale of threats means firms cannot address every risk equally

The FCA also highlighted practical shifts: greater information sharing, investment in analytics and detection tools, and deeper joint working across sectors and jurisdictions.

Firms should act now to review their financial crime frameworks, focusing on collaboration and information sharing. They should also consider how they prioritise risks and deploy technology to improve detection and response.

Read more on the financial crime speech

UK lays out tokenisation roadmap

The FCA and Bank of England have issued a joint Call for Input setting out a shared vision for tokenisation in wholesale markets. Authorities position tokenisation as a potentially transformative shift, with benefits including improved efficiency, liquidity, transparency and reduced risk.

Key points for firms:

• Regulation will remain outcomes-based, with existing standards on market integrity, resilience and investor protection maintained.
• Tokenised and non‑tokenised assets will coexist, with a focus on interoperability rather than full market replacement.
• Prudential treatment is expected to align where risks and legal rights are equivalent.
• Central bank money remains critical, with plans for programmable settlement and extended hours to support digital markets.

Authorities also highlight priority initiatives, including the Digital Securities Sandbox and the DIGIT pilot, to test issuance, trading and settlement in practice.

Firms can respond to the Call for Input until 3 July 2026.

Read more on the call for input, the future of tokenisation