UK FCA encourages risk-taking in savings strategy

Britain's financial regulator, the Financial Conduct Authority (FCA), plans to encourage retail investors to take more risks with their savings. This strategy is part of a five-year plan aimed at addressing the challenges posed by an ageing population. FCA Chair Ashley Alder shared these details before the official launch of the strategy. Alder noted the importance of helping consumers achieve higher returns on their savings. He emphasized that tackling fraud is also crucial for building trust in financial markets. The FCA has been under pressure from the government to reduce regulatory burdens and promote investment. The rising number of pensioners in the UK highlights the need for adequate income in later life. To address this, the FCA will promote a greater willingness to engage with financial products that offer long-term benefits. The government is also looking at changing tax rules for savings accounts to encourage investment in shares and bonds. The FCA aims to provide better support for pension holders by allowing companies to offer general advice under a lighter regulatory framework. Alder assured the public that this approach would not compromise consumer protection. Instead, it will enhance the tools available for making informed investment decisions. Additionally, the FCA will focus on reducing financial crime to boost consumer confidence and participation in markets. This includes being more selective in its investigations, prioritizing cases that pose the highest risk of harm. Alder indicated that recent trends show a decrease in investigations, but he believes the level of enforcement actions could remain steady. Lastly, the FCA is preparing for changes in global financial regulation due to rising protectionism. Alder suggested that the regulator may work more closely with a smaller group of like-minded countries as international cooperation evolves.