The Financial Conduct Authority is seeking views on the potential competition benefits and harms from Big Tech firms’ entry into financial services.
Sheldon Mills, executive director of consumers and competition said Big Tech firms have clearly demonstrated in recent years their potential to disrupt established markets, drive innovation and reduce costs for consumers, developing “transformative new products” in payments, deposits and consumer credit. In the longer term, though, Big Tech firms could pose competition risks if they rapidly gain market share, the watchdog warned.
“We want to make sure that these benefits are fully realised while, at the same time, ensuring good consumer and market outcomes. This is vital when we consider the role of Big Tech firms in the provision of key technological infrastructure like cloud services, Mills said.
“The discussion we are starting today will inform the FCA’s pro-competitive approach to digital markets, and I encourage consumers, firms and fellow regulators to join the conversation.”
To begin the discussion, the FCA has published analysis focusing on the potential competition impacts of Big Tech’s entry in four vital retail sectors: payments, deposit taking, consumer credit and insurance.
No regulatory changes are being proposed at this stage.
The FCA is inviting responses by 15th January 2023.
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