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Martin Wheatley says the FCA will be leading the way in “helping to shape a market that offers consumers alternatives, products that meet their needs, delivered in a way that fits with how they live.”
“rules will only work in certain conditions, regulation can do more harm than good, particularly price capping, and that co-operation can sometimes be more helpful.”
These are the lessons which Martin Wheatley, Chief Executive of the FCA, has taken from the thinking of Nobel Prize winning economist Jean Tirole. Known as the man who rewrote the rulebook on competition and regulation, through his work on industries dominated by a few major players, Jean Tirole proved that there is no ‘one size fits all’ solution and that regulation, far from being completely prescriptive, is better served by establishing a lose framework within which businesses can flourish.
Extolling the work of Jean Tirole in a speech at the Mansion House, Mr Wheatley highlighted the way in which competition in the financial markets lessened in the wake of the crisis but is now opening up with new players, including peer to peer lenders, entering the market. In response to this, the FCA will be leading the way in “helping to shape a market that offers consumers alternatives, products that meet their needs, delivered in a way that fits with how they live.”
In pursuit of this aim the FCA is looking to support innovation, opening the doors to those who come up with new ideas about how to deliver financial services. To this end they are setting up an innovation hub which will level the playing field “by giving all firms eager to innovate access to us so that the process of joining the financial markets or introducing new products does not seem so daunting.”
In a wide ranging speech Martin Wheatley also touched on consumer choice, convenience, the pace of technological change and consumer protection. In concluding he talked about the balance which the financial marketplace should be aiming for “change, some disruption, new models of distribution but all of it with the interests of the consumer at its heart.”