(Note: the below is a high level review of certain potential issues and is not to be relied upon in any definitive manner nor as legal and/or regulatory advice).
The FCA has launched its Innovation Hub as part of “Project Innovate” which was announced earlier this year, via a speech by the FCA’s CEO, Martin Wheatley.
What is the Innovation Hub?
The FCA’s Innovation Hub is a function of the FCA to support innovator businesses. As stated on the FCA website:
“We offer support to innovator businesses that are looking to introduce ground breaking or significantly different financial products or services to the market, including when they need assistance with an application for authorisation or a variation of permission.
This helps new or non-regulated businesses understand more about our regulatory framework and what it means for them, as well as firms that are already regulated.
We are also looking to add more flexibility to our regulatory framework and remove barriers to entry, to encourage and support innovation where it will not erode consumer protection or the integrity of the financial system.”
The FCA site further states:
“The support we offer to businesses through the Innovation Hub includes:
- a dedicated team and contact for innovator businesses
- help for these businesses to understand the regulatory framework and how it applies to them
- assistance in preparing and making an application for authorisation, to ensure the business understands our regulatory regime and what it means for them
- a dedicated contact for up to a year after an innovator business is authorised”
How can you use the Innovation Hub?
A business must first apply to gain the support of the Innovation Hub and before support is provided a business must meet the Innovation Hub eligibility criteria.
This is made up of the following types of matters:
Genuine innovation
- Is the innovation ground-breaking or significantly different?
Consumer benefit
- Does the innovation offer a good prospect of identifiable benefit to consumers (either directly or through greater competition)?
Background research
- Has the business invested appropriate resources in understanding the regulations in relation to its own position?
Need for support
- Does the business have a genuine need for support through the Innovation Hub?
There is a request for support form that businesses need to complete to apply for assistance from the service.
As part of its general guidance, the Innovation Hub also provides a process where certain rules will be modified to test ideas, further details are provided on the FCA website.
More details and information
The Innovation Hub has set up specific contact details as well as providing further engagement via its ‘Innovation Hub’ events – such as ‘surgeries’ and workshops where businesses can learn more about the authorisation process.