Navigating Regulatory Risk Trends in 2025: Key Insights from Pinsent Masons
As we step into 2025, the financial services landscape faces a year of transformation, with regulators aiming to balance economic growth with robust consumer protection. In the latest edition of Pinsent Masons’ Financial Services Regulatory Risk Trends update, our strategic partner focusses on critical regulatory developments shaping the industry.
The Financial Conduct Authority’s (FCA) recently released a five-year strategy with a clear focus on resilience—both for consumers and financial institutions. This edition of Financial Services Regulatory Risk Trends explores the key regulatory shifts that firms should be aware of, particularly in relation to consumer and operational resilience.
Consumer Resilience: A Stronger Framework for Protection
The UK Government’s recent Call for Input on closer collaboration between the FCA and the Financial Ombudsman Service (FOS) marks a significant development in consumer protection. This initiative comes at a time when mass redress events—such as undisclosed motor finance commissions—are drawing considerable attention from both regulators and courts.
Additionally, firms must navigate the FCA’s evolving stance on the advice/guidance boundary and targeted consumer support, especially in light of rising customer complaints and the continued embedding of the Consumer Duty framework.
Operational Resilience: Strengthening Financial Infrastructure
Beyond consumer-focused regulation, 2025 will also see increased scrutiny of ‘critical third parties’—a move that introduces further regulatory requirements for firms reliant on outsourced services. These new measures will likely reshape the contractual landscape between financial institutions and their key service providers, reinforcing the need for robust operational resilience strategies.
Sector-Specific Interventions: Motor Insurance and Capital Markets in Focus
The motor insurance market is set for a period of regulatory intervention, with the launch of a competition market study and the establishment of a motor insurance taskforce. These initiatives aim to address concerns surrounding fair pricing and market competition.
Meanwhile, capital markets also face transformation with the arrival of PISCES, a new trading platform set to modernise the sector and enhance market efficiency. With regulators seeking to foster competitiveness while upholding market integrity, firms should anticipate further updates in this space.
Read the full report here.
