Summary of FCA Consultation Paper CP21/3

  • Posted on: 1 February 2021
  • Written by: David Rodriguez

The Financial Conduct Authority (FCA) have identified barriers to the success of open banking and future innovation in UK payments. To address these, they are proposing amendments to the Technical Standards on Strong Customer Authentication and Common and Secure Methods of Communication (the SCA-RTS). At the same time, they are taking the opportunity to update their guidance on prudential risk management and safeguarding, making general updates to several areas and onshoring-related changes and updating the Perimeter Guidance Manual (PERG).

This is all part of the FCA’s efforts to make sure that: consumers transact safely with payment firms; payment firms meet their regulatory obligations while competing on quality and value; and consumers and SMEs have access to a variety of payment services. The proposed changes, also, reflect the UK’s withdrawal from the European Union (EU) and the end of the transition period.

This short document summarises the Consultation Paper to help Payment and E-money Institutions understand and prepare for the proposed regulatory changes:

  • Changes to Strong Customer Authentication
  • Strong Customer Authentication and changes to the FCA Approach Document
  • Prudential risk management and safeguarding, including wind down planning
  • Other changes to the Approach Document
  • Changes to reflect the UK's exit from the EU

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