FCA increases scrutiny of applications at authorisation gateway
The UK Financial Conduct Authority (FCA) today posted its authorisations metrics for the period from January to March 2023.
In 2021 and 2022 applicants for authorisation and registration were experiencing delays. FCA’s performance has improved following significant investment, hiring 159 extra staff in the past 2 years, and through better use of technology and data to automate parts of the process.
The data for the final quarter of 22/23 shows the FCA continues to make progress towards meeting its service level targets. The metrics, necessarily, involve a time lag so do not reflect current performance and the FCA expects to see further improvements.
The FCA says it is increasing scrutiny of applications at the authorisation gateway. The number of new firm applicants that were not authorised in 2021/22 was 1 in 5, up from 1 in 14 in the previous financial year and this has continued through 2022/23.
The Q4 decline in processing appointed representative-related applications for an ‘approved person’ status submitted by an authorised firm is due to a large number of applications being submitted before the applicant had the necessary permissions so the applications could not be determined. The applicant subsequently withdrew the application for permissions and the associated approved person applications after the deadline. Without those applications the performance would have been c.95%
The regulator says the increasing complexity of some cases means that it will not always meet its statutory targets. The FCA also continues to see too many incomplete and poor quality applications.
To improve the quality of applications the FCA has issued more detailed guidance for cryptoasset businesses and mortgage intermediaries. The regulator says it will continue to enhance the guidance to firms in other areas.
The FCA is also testing a new digitised form for approved persons applications with a sample of firms.