Data reforms announced by FCA and Bank of England
It’s essential that finance directors operating in the financial services sector understand the implications of the recent data reform announcements by the FCA and the Bank of England.
Proposed changes are set to revolutionise the way that data is collected in the industry and the way that companies are regulated. Both the FCA and Bank of England are revisiting their data and analytics capabilities in order to improve their ability to ensure market integrity, maintain financial stability and protect consumers.
Reform to FCA Data Strategy
The main focus of the revised data strategy proposals from the FCA is an increase in the use of automation which will enable the use of advanced analytics. The changes are necessary due to the higher numbers of businesses that the FCA now has to regulate as well as the way these businesses collect data.
The collection process is now automated in many businesses. So, the FCA needs to develop a deeper understanding of these automation processes. They will make use of features such as data science units and an enhanced Cloud infrastructure in order to do this.
Finance directors have already begun to acquire more advanced knowledge of the use of automation in the collection of data. So, they will understand why the FCA needs to develop its knowledge in this area. They will also know that the changes being made by the FCA mean that their businesses need to pay strict attention to the data that they collect and supply.
Bank of England Discussion Paper
It’s not just the FCA that is reviewing the way it handles data. The Bank of England has launched a review into the way regulatory data is hosted and used. It has released a consultation paper which has launched the start of the review. The review and changes are expected to take place over the next 5-10 years, in consultation with financial industry organisations.
Finance Directors who operate within the financial services industry is likely to witness the development of this review first-hand. They are also likely to benefit from the outcome of the review which is aimed at improving the timelinesses and efficacy of data as well as relieving some of the burdens on organisations within the industry.
Digital Regulatory Reporting (DRR)
As part of its fresh look at how data is reported, managed and used, the FCA is exploring how technology can help. Its work concerning the potential of Digital Regulatory Reporting (DRR) is being conducted in conjunction with the Bank of England.
The aim is to look at the introduction of technology that can be used to make it easier for businesses and organisations to meet regulatory requirements. As many FDs will be aware, financial institutions often face challenges when complying with regulatory reporting requirements. Technology has the potential to relieve many of these challenges. It also has the potential to improve the standard of information that is provided by businesses.
As the work of the FDA and the Bank of England progresses, stronger technological links should be forged, between compliance procedures and the applications and databases that are used by businesses.
This collection of data reforms that are being introduced by the FDA and the Bank of England are changing the future of the use and reporting of data in the financial services industry.
If you are a finance director or CFO looking for the next step in your career, register with us.
Date Posted: February 12th 2020
Posted By: Laurence Underwood