LONDON, Dec 4 (Reuters) – Britain will launch a fast-track licensing regime for financial services startups allowing them to get up and running while they seek full authorisation, the finance ministry said on Thursday, part of a wider drive to cut red tape and boost economic growth.
Under the new system, firms meeting “robust” entry criteria will be able to operate provisionally and carry out some regulated activities for up to 18 months, subject to safeguards, as they complete the full licensing process.
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“Too many promising firms have told us their growth is being hampered by the time it takes to secure full authorisation,” financial services minister Lucy Rigby said. “This new regime will help high-potential start-ups and scale-ups trade and grow sooner.”
Britain’s Financial Conduct Authority has faced criticism from fintechs that its approval process is too lengthy and costly, choking investment and slowing expansion.
The government has also asked the FCA to ease the regulatory burden.
Sheree Howard, executive director at the FCA, said the proposed regime would help remove barriers to entry for startups.
“We will work closely with industry, consumer groups and government to ensure the regime reduces barriers for relevant firms, while maintaining the UK’s high regulatory standards,” Howard added.
The finance ministry said the FCA would set out more detailed eligibility criteria.
Reporting by Phoebe Seers. Editing by Mark Potter
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