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FCA review of requirements, directions and limitations: The FCA has that it is reviewing and updating around 11,000 requirements, directions and limitations that it has applied to over 9,000 firms. This follows a data review which identified that some data was out of date, had been superseded by new content or needed small errors correcting. Where changes involve immaterial updates, they will be made automatically. The approach to any substantive changes required will be discussed with the relevant firm.

PRA Pillar 2A review: The PRA is consulting () until 5 September on proposed updates to Pillar 2A methodologies and guidance. This is the first phase of a two-stage review aimed at addressing the consequential impacts of the near-final rules for implementing Basel 3.1 in the UK. The second stage will consist of a review of individual methodologies within Pillar 2A in more detail and a further consultation. For the first phase, the PRA proposes to implement the changes to pension obligation risk, market risk and counterparty credit risk from 2 March 2026. Firms would also be able to apply the proposals in ICAAP submissions and the updated FSA081 template for pension obligation risk from this date. For the remaining parts of the CP, the PRA proposes to apply the new methodologies when a firm’s Pillar 2 capital requirements are reset at the first full Capital Supervisory Review and Evaluation Process (C-SREP) after implementation of the Basel 3.1 standards (1 January 2027).

Near-final policy on SME and infrastructure lending adjustments: Alongside CP12/25 (Pillar 2 review), the PRA published , which sets out near-final policy on the SME and infrastructure lending adjustments to Pillar 2A as outlined in . PS7/25 applies to firms within the scope of the PRA’s Basel 3.1 standards. Details of Pillar 2A lending adjustments for Small Domestic Deposit Takers (SDDTs) will be issued when the PRA finalizes the simplified capital regime for SDDTs. The Pillar 2A lending adjustments will be firm-specific and calibrated to maintain a firm’s overall capital requirements for SME and infrastructure lending at the same level as if the support factors had remained in Pillar 1 under the PRA’s Basel 3.1 implementation. PS7/25 and its appendices set out the calculations and associated guidance in detail. The near-final policy will take effect on the same date as the PRA’s implementation of Basel 3.1, currently 1 January 2027.

International firms � updates to PRA SS5/21: The PRA has issued updated (PS6/25) around business conducted within branches of international banks operating in the UK, including thresholds, booking models and liquidity reporting. There are several amendments and clarifications to the proposals in CP11/24, with the final policy taking immediate effect. PRA CEO Sam Woods noted that the changes “will maintain the UK’s very open approach to international banking, while filling a gap we identified in our regime and increasing some thresholds to support competitiveness and growth�. 

The most significant updates include: 

• Introduction of a new threshold for branches to bridge the gap in uncovered deposits. This would require branches to have less than £300m in retail and small company deposits in transactional and instant access accounts, regardless of FSCS coverage. 

• Uplift of the £100m and £500m thresholds (for FSCS-covered retail and small company deposits and total FSCS-covered deposits) to £130m and £650m respectively, to reflect cumulative inflation since they were introduced. The PRA considers that this approach will give international firms additional room to expand activity in their UK branches, supporting investment and economic growth whilst managing the risk of contagion.

• Firms are required to use the revised version of the Branch Return Form for the first time for their data as at 30 June 2026 (unless otherwise stated), with submission due 30 business days after that. 

• Firms are also required to undertake a self-assessment of their booking arrangements against the revised expectations to a timeline agreed with their PRA supervisory team. This should include a clear explanation of any gaps that need to be addressed and the proposed timeframe for doing this. 

PRA proposal to remove SS20/15: The PRA is (CP11/25) on removing SS20/15 (the ‘Building Societies Sourcebook�) in its entirety. Following a review of SS20/15, the PRA considers that SS20/15 is no longer consistent with broader policy approaches (e.g., establishing a level playing field) and does not support competition and growth. For more, see article above.

Revocation of onshored resolution standards: Following the UK’s withdrawal from the EU, the UK retained the EU Framework for determining the level of information required within recovery and resolution plans. Following a consultation period, the BoE has that it will proceed with revoking the on-shored UK Technical Standard 2019/348 on Simplified Obligations (SO UKTS). This should reduce the resource burden on the BoE, while preserving the application of the SO and retaining proportionality benefits for firms and authorities. There will be no impact on the firms within scope of the SO UKTS.

Insurance rule simplification: The FCA is on plans to simplify its insurance rulebook, with changes intended to ease regulatory burdens on insurers while preserving the right level of protection for customers. Key proposals include a new definition for larger commercial insurance customers and bespoke contracts that exempt them from insurance conduct rules, greater discretion over product review frequency, options for co-manufacturers to select a lead firm for product governance compliance, and the removal of duplicative reporting obligations. The FCA also discusses whether conduct rules should be disapplied to customers and insured risks outside of the UK, and rules for specific products like PPI and packaged bank accounts.

Payments for investment research: The FCA has new rules to allow UK fund managers greater freedom when paying for investment research. These changes follow on from, and mirror, new rules already introduced for MiFID investment firms in 2024. The changes to the regime are set in the context of the drive to improve the provision of investment research in the UK � which can be linked back to the government and FCA's growth and competitiveness agenda. Fund managers can now consider whether they would like to make joint payments for research. If they plan to do so, they will need to consider carefully the guardrails that need to be implemented and ensure that they deliver good outcomes for customers.

FCA review of smaller asset managers: The FCA has completed a of 410 smaller asset managers to identify business models that pose a greater risk of harms to consumers. The findings focus on product governance relating to high-risk investments, conflicts of interest arrangements, and the application of the Consumer Duty. The FCA expects smaller firms' boards to review the publication. It will continue to monitor firms' conduct on these topics and notes that the findings may also be relevant to larger asset managers.

Sustainability Disclosure Requirements: The FCA has that it will no longer publish a policy statement in Q2 2025 on extending its Sustainability Disclosure Requirements (SDR) to portfolio management services, including wealth management, saying that now is "not the right time". Although the SDR rules for UK funds were finalized in December 2023, a policy statement on SDR for portfolios had been expected since CP 24/8 was launched in April 2024. In the short term, the FCA will instead focus its resources on carrying out the planned multi-firm review on model portfolio services in the context of the Consumer Duty. 

Regulation of Buy-Now-Pay-Later (BNPL): HMT has proposals for the regulation of BNPL products and laid legislation in parliament. The framework brings BNPL firms in scope of the Consumer Credit Act (CCA) and FCA oversight. Once legislation has been finalized, the FCA will set out the rules for BNPL firms including disclosure requirements, affordability and FOS rights. Exemptions include agreements financing insurance, and merchants which provide their own short-term interest-free products. For now, domestic premises suppliers offering BNPL remain in scope as credit brokers � however, in response to emerging stakeholder concerns, the government will consider this further. The legislation will now be laid in parliament, and the new regime is expected to be in effect by mid-2026.

Consumer Credit Act reform: HMT has proposals to reform the Consumer Credit Act 1974 (CCA). Due to the scale and complexity of the reform, work has been split into two phases. This phase one consultation sets out the high-level approach to the new regime. It also seeks views on proposals to repeal information requirements, replacing them with new FCA rules, and a repeal of sanctions requirements, placing reliance on existing FCA rules. The consultation also considers whether it is necessary to retain some or all the criminal offences in the CCA, or whether they can all be repealed. Phase two will address the scope of regulation, key definitions and core consumer rights.

Consumer credit regulatory returns: The FCA has its consumer credit regulatory returns Policy Statement (PS25/3), introducing a new reporting return for consumer credit firms engaged in credit broking, debt adjusting, debt counselling and the provision of credit information services. The return includes five mandatory sections, followed by tailored questions based on firms� permissions. Although largely unchanged from the consultation, notable amendments to the return include a 27% reduction in the volume of questions, an extension of the submission window to 40 days in any reporting period, and rule clarifications. The first reporting period will run from 1 January 2025 to 31 December 2025.

Complaints data reporting: The FCA is on streamlining complaints data reporting, proposing to consolidate five existing returns into a single return to remove inefficiency, reduce the reporting burden and reduce the risk of misreporting. The five returns are Dispute Resolution 1, Consumer Credit, Payment Services, Claims Management Companies, and Funeral Plans. Firms will be asked to complete questions linked to their permissions. Other proposals include a move to calendar year reporting, removing group reporting and changes to the complaints� categorisation taxonomy � including a new category to capture Consumer Duty outcomes complaints and complaints where the customer is identified as vulnerable. The first collection using the new return will be for the period ending December 2026. 

H2 2024 Complaints data: The FOS’s H2 2024 shows a significant increase in overall complaints volumes � 49% higher than H2 2023. This continues a trend seen over the last couple of years. Disputes around banking fraud, credit affordability and motor finance commission are the main drivers for the increase. Complaints brought by Professional Representatives (PRs) continue to rise, accounting for around 46% of new complaints referred the FOS, compared to 22% in H2 2023. Much of can be attributed to PRs' involvement in car finance complaints, most likely driven by the FCA's ongoing work on discretionary commission in motor finance. PRs are also active in other areas and brought over 50% of all banking and credit complaints. 

Mortgage rule simplification: The FCA is on changes to its mortgage rules to simplify regulations and support sustainable home ownership. Proposals include removing the "interactive dialogue" trigger for mandatory advice, allowing simpler affordability assessments for term reductions and remortgaging, and retiring existing non-Handbook guidance on interest-only mortgages and cost of living support. The changes are intended to reduce the regulatory burden for firms and support growth and competitiveness.

Pensions Investment Review: HMT has the government’s final report on the Pensions Investment Review, along with related consultation responses. The report advances significant measures to assist the consolidation of the Defined Contribution (DC) market and the Local Government Pension Scheme (LGPS). Reforms include setting minimum scale and investment capability requirements, introducing a regulatory approval process for creating new default arrangements, and a contractual override mechanism for the bulk transfer of assets. At this time the government will not advance proposals to introduce a duty for employers to consider value in pension scheme selection. Legislation to implement the reforms will form part of the forthcoming Pension Schemes Bill.

Third-party applications: TPR has  updated guidance to clarify the process for making third-party applications, such as appointing an independent trustee for a pension scheme. The guidance helps applicants understand what information to provide for more efficient and effective processing. The changes are intended to improve the process for schemes and ensure that savers' pensions are protected.

Innovation service: TPR has  the launch of a new service to support innovation, enabling early transparent discussions with pensions innovators by reducing unnecessary regulatory barriers. The service will offer innovators access to TPR staff to discuss new pensions-related ideas or solutions, host collaborative events, deliver thought leadership, facilitate access to the FCA's innovation test service, and support emerging pensions models. The first innovation event will be held on 4 June 2025. TPR will focus efforts on two areas of innovation in particular: administration and member experience, particularly in the decumulation phase; and investment and new scheme models.

Next steps for UK cryptoasset regime: The article above summarises HMT’s highly-anticipated draft  (SI) and  on the UK’s cryptoasset regulatory regime as well as the FCA’s which sets out thinking on the detailed regulation of the activities in the SI (including trading, intermediaries, lending / borrowing and staking). More recently, the FCA has published which lays out proposed rules for stablecoin issuance and cryptoasset custody and which addresses the proposed prudential regime for stablecoin issuers and cryptoasset custodians. These will be supplemented by additional consultations (including on conduct and firm standards) which are expected later this year. 

See Capital Markets and Asset Management for update on FCA Sustainability Disclosure Requirements (SDR).