As we move into 2026, the FCA continues to evolve its regulatory approach. We discuss the major compliance issues facing the financial services industry and what firms need to focus on.
Key takeaways
- Delivering demonstrable outcomes under Consumer Duty. In 2026, the FCA's priority is evidence, not intent. Firms must show Consumer Duty is fully embedded across products, distribution chains and customer journeys, with clear outcomes monitoring.
- Bringing new sectors firmly into regulation. Cryptoassets (especially stablecoins), AI-enabled services, open finance and ESG are moving from policy development to regulatory implementation, marking a significant expansion of the FCA's perimeter.
- Driving system-wide reform while strengthening resilience and trust. Advice reform, pensions value-for-money, operational resilience, streamlined authorisations and tougher financial crime controls underline the FCA's focus on improving market integrity, access and consumer confidence in 2026.
Firms must stay agile, adapting to new priorities and emerging risks. Here's an overview of key areas likely to be under the Financial Conduct Authority's (FCA) spotlight:
FCA Compliance Focus in 2026
Priority 1. Consumer Duty - Enhanced embedding phase
The Consumer Duty remains a key priority for 2025/26. The FCA is shifting from implementation to outcomes, focusing on embedding the Duty across sectors. Multi-firm reviews will assess outcomes monitoring, product design, customer journey mapping, and consumer understanding to ensure firms are delivering tangible benefits.
In H1 2026, the FCA plans consultations on amendments addressing distribution chains and clarifying that the Duty applies exclusively to UK customers, reinforcing clear expectations for firms operating across borders.
Priority 2. Cryptoassets and digital assets regime
This represents a major new priority. The FCA is progressing a broad package of consultations through early 2026 to establish the UK's full crypto‑regulatory regime. These cover core elements such as rules for crypto trading platforms, intermediaries, staking, lending/borrowing, decentralised finance and the regulatory treatment of stablecoin issuance, custody and prudential requirements.
The consultations follow Treasury draft legislation that will embed specific crypto activities into the UK regulatory perimeter. Final policy statements are expected in 2026, setting the stage for the authorisation gateway to open later in the year and for firms to prepare for the regime's implementation.
Sterling‑issued stablecoins are a key focus, with the FCA seeking to ensure their governance, value stability, and consumer protections are robust, while a proposed regulatory sandbox aims to foster innovation under careful oversight.
Priority 3. Artificial Intelligence and technology innovation
The FCA is actively helping firms adopt AI responsibly by providing practical support rather than introducing new, AI‑specific rules. Through its AI Lab, firms can develop, test and experiment with AI solutions in a safe environment, including access to initiatives like AI Live Testing and the Supercharged Sandbox where innovations can be trialled with regulatory engagement and oversight.
These programmes aim to give firms confidence in deploying AI while deepening both regulator and industry understanding of risks and opportunities.
The FCA’s approach remains principles‑based and outcomes‑focused, relying on existing regulatory frameworks, such as Consumer Duty and governance expectations, to govern AI use rather than creating separate AI rules. This enables firms to innovate within clear boundaries and helps regulators and industry collaborate on emerging best practices.
The FCA is working to assess GDPR barriers to AI innovation with the ICO, supporting innovation through existing regulatory frameworks rather than creating new, specific rules.
Priority 4. Operational resilience and authorisations reform
The FCA is actively digitising and simplifying its authorisation processes to reduce burden and improve efficiency, part of its broader push to be a smarter, growth‑oriented regulator. This includes transforming how applications are submitted and processed, which should improve the quality of applications and help decisions be made more quickly.
As part of this reform, the FCA has extended its pre‑application support service (PASS) to all wholesale, payments and crypto firms. This means these firms can engage with the regulator earlier to clarify expectations and address issues ahead of submitting formal applications.
The FCA is also more frequently indicating that it is ‘minded to approve’ promising start‑ups ahead of full authorisation. This provides early confidence for investors and founders during fundraising cycles, helping innovative firms secure funding while they complete the full regulatory approval process.
Priority 5. Motor finance redress
The FCA will confirm within six weeks of the Supreme Court’s decision whether it intends to propose a motor finance redress scheme and, if so, will consult on how that scheme would be implemented, including any necessary rule changes.
This work is part of a major exceptional project in the FCA’s 2025/26 programme, with £6.9 million allocated to its review of historic discretionary commission complaints and potential redress arrangements.
Priority 6. Advice Guidance Boundary Review (AGBR)
The FCA is reforming the rules governing financial advice and guidance by proposing a new targeted support framework to help consumers navigate pensions and retail investment decisions more effectively. This regime would allow firms to offer tailored suggestions to groups of consumers with similar characteristics, closing the "advice gap" between basic guidance and full personalised advice, and sits alongside plans to consult on simplifying advice rules in early 2026.
The FCA has allocated £3.7 million in its 2025/26 programme to support this joint government and regulator initiative, reflecting its significance as a major reform to how advice and support are delivered.
Priority 7. Open banking and open finance
Using powers expected under the Data (Use and Access) Bill, the FCA is progressing the development of a long‑term regulatory framework for open finance, which will extend data‑sharing beyond traditional open banking to a broader set of financial products and services and support innovation in markets such as SME lending.
The regulator is working with government and industry to build this framework and align it with the UK's National Payments Vision, which also includes the rollout of variable recurring payments (VRPs) as a new open banking payment method offering greater flexibility and efficiency for consumers and businesses.
To support this work, the FCA has allocated £1.2 million for Open Banking and a further £2 million for Open Finance development in its 2025/26 programme, reflecting its investment in enabling data‑driven financial services growth and competition.
Priority 8. Financial crime and fraud prevention
The FCA is strengthening its data‑led detection capabilities to identify and prevent financial crime more effectively, aiming to make it harder for serious organised crime to exploit financial services. This includes increased collaboration with government agencies, law enforcement, and industry partners to share intelligence and coordinate action.
The regulator is also placing a strong focus on proactive assessments of anti‑money‑laundering systems and controls for higher‑risk firms, ensuring that they are robust and capable of addressing emerging threats.
Priority 9. Pensions dashboards and value for money
The FCA will open the authorisation gateway for private sector pensions dashboard operators once the government and the Pensions Dashboards Programme have provided the necessary information for firms to be ready to design and build dashboard services with the final regulatory framework already published and industry receiving advance notice ahead of applications. This forms part of the FCA’s wider effort to enable broader access to pension information for consumers.
At the same time, the FCA, working with the Department for Work and Pensions (DWP) and The Pensions Regulator (TPR), is progressing the development of a long‑term value‑for‑money framework for pension products. This goes beyond costs alone to provide greater transparency on investment performance, service quality and other metrics that support consolidation and better outcomes for savers.
Priority 10. ESG and sustainable finance
The FCA is consulting on rules for ESG ratings providers to enhance transparency, reliability and comparability in the market, following recent government legislation bringing these providers into the regulator’s remit. The consultation, which is open until March 31 2026, also aligns with broader work on sustainability disclosures, including referencing ISSB standards and strengthening expectations for transition plan reporting, supporting the UK’s strategy to be a global sustainable finance hub.
According to the FCA’s 2025/26 programme, £3 million has been allocated for the development of ESG ratings regulation, reflecting its commitment to fostering investor confidence and high‑quality sustainable finance markets
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Written by: Katharine Leaman
Katharine Leaman spent 11 years within the FCA, then oversaw compliance at two major banks. She now consults on regulatory compliance across market conduct, CASS, SMCR, FX Global Code, Outsourcing, non-financial misconduct, and conduct risk. Her consultancy provides regulated firms with digital regulatory compliance materials.
