The Financial Conduct Authority or FCA is a government-independent financial regulatory entity. It was established in the United Kingdom and is funded by the fees paid by member companies involved in providing financial services.
Compliance with FCA authorisation regulations from Pragmatic Compliance ensures the following:
- Effective and fair competition between financial service providers with focus on the customers’ interests
- The financial products and services promised are delivered by trusted and compliant financial firms.
- Stable, sound, and resilient financial and market systems that provide pricing data that is transparent to the customers.
Being established just recently after the phase out of the Financial Services Authority, the compliance process is quite new and rules are not familiar to some financial service providers, especially the small to medium sized ones. If you fall into this category or your company may not have enough human and knowledge resources, outsourcing FCA compliance may be a more viable option. Here are the disadvantages of letting the experts do the dirty work for you:
- They can help you through the whole gamut of the compliance process: initial authorization, documentation and control framework requirements from FCA, and provision of continuous monitoring and maintenance.
- If you opt to get involved in the majority of the compliance process, they can provide additional support and give advice whenever appropriate. This is ideal for small firms that have commissioned the maintenance and administrative aspects of the FCA compliance internally, but still require assistance on more complex regulatory issues that may occur.
- They can offer part-time coverage of the compliance officer’s tasks in case of absence, be it planned or unplanned. With their knowledge and experience of the process, delays will be avoided if someone from the compliance team files a leave of absence.
- Outsourcing FCA compliance can be more cost effective since the services offered can be flexible and available on demand. Hiring skilled internal compliance officers will, on average, cost more than getting the service externally.
- Companies specializing in FCA compliance have broader experience of the evolving regulations and applications so they can come up with better, more effective approaches in response to the changes.
- They can provide you with a tailor-fit solution that is appropriate to the range and scale of your business activities. Not all financial firms are equal and underdoing or overdoing the FCA compliance process can have negative effects to your company’s certifications.