FCA's anticipated priorities for FinTechs

As 2026 begins, the FCA is sharpening its focus on strategic priorities aimed at fostering a fairer, more stable, and innovative UK financial services market. For FinTech companies, understanding the regulator’s evolving direction will be essential to navigating the year ahead.

This article examines the FCA's anticipated priorities for 2026 and considers their likely impact on firms operating in the FinTech sector.

Smarter regulation and supporting innovation

The FCA has committed to becoming a more agile and growth-friendly regulator, reflecting its new secondary objective to facilitate the international competitiveness and growth of the UK economy. Central to this approach is the streamlining of the authorisation process for new firms. The regulator has set out ambitious targets to deliver "quicker, more proportionate and predictable" authorisations, while maintaining high regulatory standards. This is welcome news for FinTech start-ups seeking approval to launch innovative products and services.

To support this, the FCA has expanded its Pre-Application Support Service (PASS), which offers free preliminary guidance to firms preparing applications. PASS is increasingly relevant to firms operating across a wider range of sectors, including crypto asset businesses and payment institutions. By engaging early with the regulator, FinTech firms can improve the quality of their applications and avoid common pitfalls that delay authorisation.

The FCA is also investing heavily in technology and data analytics to strengthen its regulatory capabilities. By becoming more data-driven, the regulator aims to identify risks earlier and supervise firms more efficiently. For the FinTech sector, this should mean the FCA is better equipped to understand innovative business models and provide proportionate oversight. Alongside this, the regulator continues to support initiatives such as regulatory sandboxes, which allow firms to test new products in a controlled environment with appropriate safeguards.

Consumer protection and the consumer duty

Protecting consumers remains at the heart of the FCA's regulatory approach. The Consumer Duty, which came into force in 2023, requires firms to deliver good outcomes for retail customers across four key areas: products and services; price and value; consumer understanding; and consumer support. The FCA has made clear that "embedding the Duty well across sectors is critical" to ensuring consumers are properly protected. 

In 2026, the FCA will continue to shift from implementation to active supervision of Consumer Duty outcomes. FinTech firms should expect increased scrutiny of whether products genuinely deliver value, whether customer communications are clear, fair and not misleading, and whether support mechanisms adequately meet customer needs, particularly those of vulnerable customers. 

Multi-firm reviews and data-driven supervision are likely to be used to identify areas where consumer outcomes are falling short. For FinTech companies, this means that building and maintaining a strong Consumer Duty compliance culture is not optional. Digital lenders, investment apps, and challenger banks will need to demonstrate, through robust evidence, that they are monitoring customer outcomes and taking action where necessary. This sustained focus on outcomes rather than processes reinforces a significant shift in regulatory expectations.

Regulating buy-now-pay-later

A major development anticipated for 2026 is the regulation of the Buy-Now-Pay-Later (BNPL) sector. Following extensive consultation, the FCA is expected to finalise and introduce new rules in early 2026, with an anticipated compliance deadline of 15 July 2026.

After this date, BNPL providers will need to be authorised by the FCA and comply with a modified consumer credit regulatory framework. This will include requirements to carry out proportionate affordability and creditworthiness assessments, provide clear and timely pre-contract information, handle complaints effectively, and treat customers fairly where they experience financial difficulty. 

While regulation is likely to increase compliance costs for BNPL providers, it should also help create a more level playing field and strengthen consumer confidence in these products. FinTech firms offering BNPL services should begin preparing now to meet the expected July deadline, ensuring that their systems, controls and customer journeys are capable of meeting the new regulatory requirements.

Crypto assets enter the regulatory fold

After years of relatively limited regulation, crypto assets are moving firmly into the regulatory mainstream. The UK Government has proposed comprehensive legislation to regulate crypto assets in a manner more closely aligned with traditional financial instruments.

By mid-2026, a framework is expected to require crypto asset exchanges, custodians, and brokers serving UK customers to obtain FCA authorisation and comply with standards on transparency, consumer protection, and market integrity. Chancellor Rachel Reeves has stated that this approach will provide firms with "clear rules of the road" for investment and innovation, whilst ensuring that bad actors are excluded from the UK market. 

For crypto-focused FinTechs, this increased regulatory clarity is largely positive, offering a more stable environment in which to develop products and build customer trust. However, it will also require significant investment in compliance infrastructure comparable to that of traditional financial services firms.

The FCA has also identified regulated stablecoins as a priority area for payments innovation in 2026 and will use its regulatory sandbox to enable the safe testing of stablecoin use cases, supporting the development of faster and more convenient payment solutions. This approach demonstrates the FCA's openness to crypto innovation where risks are appropriately managed.

Fighting financial crime

Combating financial crime remains a top priority for the FCA, and FinTech firms can expect increased scrutiny of their anti-money laundering and fraud prevention systems and controls. As digital finance continues to create new channels for fraud and money laundering, regulators expect firms to implement robust and adaptive frameworks that go beyond tick-box compliance.

FinTech companies operating in payments, lending, and crypto should anticipate closer examination of how they verify customer identities, monitor transactions for suspicious activity, and protect customers from scams, including through proactive supervision and targeted reviews. 

Recent enforcement actions, including substantial fines for anti-money laundering failures, demonstrates the regulator's willingness to take tough action against firms with inadequate controls. In 2026, FinTech firms will need to ensure their financial crime frameworks are genuinely fit for purpose. This includes the effective use of technology and data analytics to detect suspicious patterns, robust onboarding and due diligence, and comprehensive training for staff.

Strong financial crime controls not only help meet regulatory expectations but also protect firms’ reputations and customer trust.

Operational and cyber resilience

Operational resilience has become a critical regulatory focus following a series of high-profile IT outages and cyber-attacks affecting the financial services sector. The FCA expects firms to demonstrate that they can prevent, respond to, and recover from operational disruptions affecting important business services, while continuing to serve customers.

New rules are being introduced or brought into force that allow UK regulators to oversee critical third-party technology providers whose failure could significantly disrupt the financial system. This is particularly relevant for FinTechs, which often rely heavily on cloud services and other third-party platforms.

In practical terms, FinTech firms must ensure robust vendor risk management, comprehensive business continuity planning, and strong cyber security controls. Regular testing of incident response and recovery capabilities will be expected, alongside clear governance and oversight of critical third-party relationships. 

Demonstrating operational resilience is essential not only for regulatory compliance but also for maintaining customer trust in always-on digital services.

Conclusion

The FCA's priorities for 2026 reflect a careful balancing act between fostering innovation and competition, while strengthening consumer protection and managing emerging risks. For FinTech firms, this creates both challenges and opportunities. The regulatory environment is becoming more accommodating to innovation, with faster authorisations, expanded support services and a growing openness to new technologies such as stablecoins. However, expectations around consumer outcomes, financial crime prevention, and operational resilience continue to rise.

Success in 2026 will depend on FinTech companies engaging proactively with the regulatory agenda. This means embedding consumer-focused values throughout the business, investing in robust compliance infrastructure, and building operational resilience from the outset. Firms that view regulation as an enabler rather than a burden, using it to build trust and differentiate themselves in the UK market, will be well positioned to thrive in the evolving UK FinTech landscape.