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FCA makes pledge to improve authorisation process

The Financial Conduct Authority (FCA) has launched a five-step plan to improve how it communicates with companies undergoing the full authorisation process.

Marcel   LeGouais

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Marcel   LeGouais
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The FCA admitted that 118 closed cases breached a statutory deadline for how long it took to determine applications, and has now made a pledge to improve how it updates firms on the progress of their submissions.


Between April 1 2014 and March 31 2016, the FCA received nearly 37,000 applications for authorisation from consumer credit firms.


The regulator has already closed 87 percent of these applications – 99.6 percent within the statutory deadline. But a number of cases (118 closed cases) breached the deadline during this period.


There are also around 200 open applications which have not been determined within 12 months. Unless there are significant changes to the applications (for example an application becomes invalid), these open applications will be reported as a breach once they are closed.


The pledge

The FCA said it has received feedback from firms and industry bodies that the process could be improved by more contact from a case officer in the early stages of application and by receiving extra updates.


After taking feedback on board, the FCA has made the following commitments:


1. It will tell companies as soon as their application has been assigned to a case officer. All communication about the firm’s application will be handled by this person. If it subsequently proves necessary to assign the case to a different case officer, businesses will be told as soon as the change is made.

2. All communications from companies will be acknowledged within two working days.

3. A substantive response will be given within 10 working days and, where this is not possible, an update will be sent within the 10 working day period telling firms when they should expect to receive a substantive response from the FCA.

4. Companies will be given clear deadlines when asked to submit additional information.

5. Firms will receive an update from the designated case handler on the current status of a case at least once a month.


The FCA said it took the decision to prioritise applications from new entrants, because firms with interim permission are able to continue trading, whereas new to market firms had to be authorised in order to begin trading.


The regulator added that the length of time taken to determine applications can be impacted by a number of factors, including the number of complex cases from higher risk sectors, such as the commercial debt management and high-cost short-term credit sectors, or how incomplete an application is when it is submitted.


The FCA estimates that nearly 99 percent of all applications closed by the end of September 2016 will be determined within the statutory deadline.

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