Emma RadmoreThe FSMB had its second reading in the Lords on 10 January. Baroness Penn, leading for the Government, summarised the importance of the Bill and its overarching aims, which she described as:
- implementing the outcomes of the future regulatory framework review;
- bolstering the competitiveness of UK markets and promoting the effective use of capital;
- making the UK an even more open and global financial hub;
- harnessing the opportunities of innovative technologies for safe adoption in the UK; and
- promoting financial inclusion and enhancing consumer protection.
Overall, the Bill has cross-party support. Immediate queries and comments came on:
- addressing the poverty premium – and linking this to access to cash and essential financial services and the need for BNPL regulation;
- not just compensation for fraud, but addressing the other risks it presents and the urgent need for a good fraud prevention strategy and greater enforcement;
- crytpo regulation, and whether the Bill is doing enough (the feeling is that it is not, and that regulation needs to be fast-tracked);
- the risks of the new regulatory powers meaning that parliamentary scrutiny is bypassed – in particular how properly to control the post-Brexit process;
- extending the SMCR to FMIs, when the Government has admitted it has not worked;
- the lack of a private right of action – the Liberal Democrats say they will look to replace the consumer duty with a duty of care and private right of action, to extend FCA’s regulatory perimeter to cover SME lending and to relieve the plight of mortgage prisoners;
- accountability of regulators and how, practically, Parliament can properly do this; and
- the focus of the competitiveness objective.
The Bill will now move to Committee stage in the Lords.