Financial Services SpeedRead: 24 October 2025 edition

Welcome to the latest edition of the Financial Services SpeedRead, a collection of bite-sized updates designed to help you keep on top of key regulatory developments in financial services over the preceding fortnight. Please get in touch if you want to explore any of the topics covered in this fortnight's edition of Financial Services SpeedRead in more detail.

Financial Markets

1. FCA published primary market bulletin 58 on POATRs

On 17 October 2025, the FCA published its Primary Market Bulletin (No. 58) focusing on the upcoming implementation of the Public Offers and Admissions to Trading Regulations (POATRs) regime. The changes aim to make the UK’s capital markets more competitive and efficient.

The new regime will introduce the Prospectus Rules: Admission to Trading on a Regulated Market (PRM) sourcebook, which will replace the existing prospectus framework. Alongside this, amendments to the UK Listing Rules and other sections of the FCA Handbook will be implemented.

The FCA expects to publish updated forms and checklists to accompany draft document submissions under the new regime around 24 November 2025. Subsequently, from 1 December 2025, issuers can submit draft prospectuses and related documents under the new regime, but approvals will only be granted from 19 January 2026, when the POATRs come into force. During this transition period, issuers will need to use a short form to identify submissions made under the new framework.

Other changes following the implementation of the POATRs include:

• the Listing Particulars and Supplementary Listing Particulars, together with any final terms, becoming obsolete;
• revisions to sponsor declarations (limited to format and updated references); and
• the introduction of MTF admission prospectuses.

The FCA is currently consulting on new and amended guidance notes to align with the POATRs. Feedback is requested by 21 November 2025, with an extended deadline of 5 December 2025 for the new technical notes, and the amendments to certain procedural and technical notes.

2. Financial Services and Markets Act 2023 (Commencement No. 11 and Saving Provisions) Regulations 2025 are published

On 14 October 2025, the Financial Services and Markets Act 2023 (Commencement No. 11 and Saving Provisions) Regulations 2025 were published. The regulations set commencement dates for the revocation of assimilated law (formerly "retained EU law"), including the repeal of the current UK Prospectus Regulation regime which will be revoked on 19 January 2026.

The existing regime will be replaced by the new public offers and admissions to trading regime, which will come fully into force on the same date under the Public Offers and Admissions to Trading Regulations 2024. The FCA's rules relating to admissions to trading set out in the Prospectus Rules: Admission to Trading on a Regulated Market (PRM) sourcebook will also come into effect on the same date.

The commencement regulations include saving provisions, preserving the application of the existing prospectus regime to:

• offers of transferable securities to the public made before 19 January 2026;
• requests for admission to trading on a regulated market made before 19 January 2026; and
• prospectuses approved by the FCA before 19 January 2026.

The FCA are also expected to issue guidance shortly as to when it will begin to review prospectuses under the PRMs for the purpose of admissions after 19 January 2026.

3. ESMA publishes key reforms on settlement discipline

On 13 October 2025, ESMA published its final report providing draft amendments to the regulatory technical standards (RTS) on Settlement Discipline. The reforms are designed to improve settlement efficiency across the EU and support the transition to a shorter settlement cycle (T+1) by 11 October 2027.

Key amendments include:

• trade allocations and settlement instructions must now be completed on the same day as the transaction (trade date);
• allocations and confirmations are required to be machine-readable; and
• key functionalities such as the ability to place transactions on hold and release them, automatic partial settlement, and automatic collateralisation are now compulsory.

The new requirements will be rolled out in stages, starting in December 2026 and reaching full implementation by 11 October 2027, to facilitate a seamless transition to the updated framework. The European Commission has currently three months to decide on the adoption of the draft amendments.

4. FCA publishes policy statement on MiFID Org Regulation Restatement

On 9 October 2025, the FCA published a policy statement (PS25/13) on restatement of the MiFID Organisational Regulation in the FCA Handbook. The statement contains three separate instruments, including:

1. Markets in Financial Instruments (Transfer of MiFID Organisational Regulation) Instrument 2025 containing amendments to sourcebooks and manuals in the FCA Handbook;
2. Commodity Derivatives (Position Limits, Position Management and Perimeter) (No 2) Instrument 2025 bringing into force the rule in MAR 10.4.3A relating to commodity derivatives positions and weekly reports; and
3. Technical Standards (Markets in Financial Instruments Regulation) (Organisational Requirements) Instrument 2025 containing amendments to Commission Delegated Regulation (EU) 2017/589 as it forms part of assimilated law in the UK.

The policy statement also confirms two changes previously consulted on for optional exemption firms:

• removing the requirement to report a 10% drop in portfolio value to a retail client from COBS 16A.4.3UK so it no longer applies as a rule to optional exempt firms, in line with MiFID firms; and
• amending the definition of "durable medium" to make electronic communications the default mode of communication with retail clients in relation to requirements deriving from the MiFID Org Regulation. Firms will still be required to inform retail clients upfront that they can receive paper communications.

The FCA also confirmed that it plans to consult on conflicts of interest and client categorisation rules in November 2025.

The majority of the changes set out in the policy statement will come into force on 23 October 2025.

5. ESMA Updates Standard Market Size for Systematic Internalisers’ Quoting Obligations

On 8 October 2025, ESMA announced the upcoming publication of updated standard market size (SMS) thresholds for the quoting obligations of Systematic Internalisers (SIs). The SMS determines the minimum size of quotes that SIs must provide when dealing in shares, depositary receipts, exchange-traded funds (ETFs), certificates and other similar financial instruments.

The revised regulatory technical standard (RTS) 1, which introduces new lower and upper limits to the quoting obligations under the Markets in Financial Regulation Review (MIFIR), for SIs, will be published in the Official Journal (OJ) in the coming weeks. Notably, 20 days after its publication, provisions such as the minimum quoting size for SIs and the threshold for transparency obligations, both determined by recalibrated SMS based on average value of transactions (AVT) liquidity bands, will become applicable. ESMA will publish the SMS for liquid equity and equity-like instruments the day before the revised RTS 1 applies, and the full list will be accessible via the ESMA Register. Additionally, from the same date RTS 1 applies and 20 days after the publication in the OJ, give-up and give-in transactions executed off venue will be excluded from post-trade transparency reporting. The remaining provisions, including new pre-trade transparency requirements and amended post-trade transparency details, are scheduled to take effect on 2 March 2026.

This announcement is intended to assist market participants with their preparations to apply the new quoting requirements, even though the official implementation date has not yet been specified.

Banking and Prudential

6. EBA publishes report on "white labelling" in banking and payments

On 14 October 2025, the EBA published a detailed report examining the growing use of white-labelling arrangements, where a licensed financial institution manufactures a product that is branded and distributed solely under a partner's name.

Key benefits identified in the report include lower set-up costs for partners, faster market entry for providers, wider product choice for consumers and the potential to foster financial inclusion. However, the EBA also identified risks related to consumer transparency, mis-selling, fraud, AML/CFT controls and inconsistent complaints handling; supervisory visibility over unregulated partners is limited.

The EBA did not flag any immediate need to amend EU law but identified a need to align supervisory approaches during 2026, in particular to develop common understanding of the regulatory qualification (outsourcing, agency, other) of white-labelling arrangements and the assessment and identification of emerging risks. The EBA will continue to monitor banks' engagement in white-labelling.

7. PRA finalises restatement of MiFID Organisational Regulation

On 9 October 2025, the PRA issued Policy Statement 16/25, confirming that the organisational requirements currently found in the MiFID Organisational Regulation will be lifted into the PRA Rulebook with no substantive policy change. The restated material covers general organisational rules, senior management responsibility, outsourcing, record-keeping, compliance, internal audit and risk management. Commencement is aligned to HM Treasury’s revocation of the EU text and is expected on 23 October 2025; the PRA will delay or revoke its rules if the Treasury order is not made.

The Governance and Internal Requirements Instrument 2025 takes effect on 23 October 2025. The new Rulebook Part creates a consolidated governance framework for PRA-authorised banks, building societies and designated investment firms.

References to the EU concept of a “supervisory function” have been replaced with “governing body” to reflect typical UK board structures while preserving oversight duties.

The PRA published destination table mapping MiFID Org Reg to new Rulebook provisions. The table lists each Article of MiFID Org Reg and the exact Rulebook rule that now contains the corresponding text, assisting firms with gap analysis and implementation planning.

The Technical Standards (Revocation of MiFID Org Reg) (Consequential Amendments) Instrument 2025 amends Commission Delegated Regulation 2017/589 (as it forms part of UK assimilated law) ensure cross-references point to the new Risk Control rules rather than revoked EU legislation. Firms must continue to perform an annual self-assessment and validation of their algorithmic trading systems, have the report audited by internal audit and remediate any deficiencies.

Firms should now work from the new PRA Rulebook rather than the EU regulation when updating policies, controls and documentation.

Fund Management

No new entries.

Senior Managers and Governance

No new entries.

Financial Crime

8. FCA publishes findings of multi-firm review on combating romance fraud

On 17 October 2025, the FCA published findings of its multi-firm review examining how firms are tackling romance fraud, which is a type of scam where criminals exploit personal relationships to defraud victims, often through online platforms.

Key findings are as follows:

• Detection and monitoring: While some firms effectively used detection systems and data points to identify and prevent suspicious transactions and romance fraud, many missed opportunities to spot unusual activity, indicating a need for better-calibrated monitoring systems and more robust investigative processes.
• Internal investigative approaches and staff capabilities: Most firms adopted a victim-centred approach and shared information well, but significant gaps remained in payment analysis and staff ability to identify red flags, with inconsistent investigation of all payment types and insufficient probing of customer explanations.
• Customer engagement and support: The FCA expects firms to offer clear and accessible support to victims. This includes providing guidance on how to report fraud and steps for recovering losses, ensuring victims are not left unsupported.
• Treatment of customers in vulnerable circumstances: While many firms took proactive steps to support vulnerable customers and prevent repeat victimisation, there were frequent failures to identify vulnerabilities early or to take appropriate safeguarding actions even after fraud was confirmed.
• Education and awareness: Firms should strengthen staff training and improve how they communicate with customers and identify signs of vulnerability. Better education and clearer messaging can help both staff and customers spot and prevent romance scams.

The FCA expects UK Payment Service Providers (including banks, building societies, and other businesses that provide payment accounts) to review the findings and improve their systems and controls accordingly.

Retail Services

9. FCA publishes consultation for motor finance consumer redress scheme

On 7 October 2025, the FCA published its consultation for a motor finance consumer redress scheme for customers in light of the Supreme Court's decision in Johnson v FirstRand Bank Limited (London Branch) t/a MotoNovo Finance (2025) and the High Court's decision in R (Clydesdale Financial Services Ltd) v Financial Ombudsman Service Ltd (2024).

The scheme will cover regulated motor finance agreements taken out by consumers (including sole traders and small partnerships) between 6 April 2007 and 1 November 2024, where commission was payable by the lender to the broker. The scheme would consider if there was adequate disclosure of the commission arrangement and any contractual ties between lenders and brokers.

There would be four key stages to the scheme:

1. Pre-scheme checks: Firms will contact customers to inform them whether their case is covered by the scheme and what steps they need to take. For consumers who have already complained, this process must be completed within three months. For those who have not previously complained, firms have six months to make contact, and these customers will need to opt in to participate in the scheme.

2. Liability assessment: Firms will assess whether they are liable to pay redress, which will be where a relationship is considered unfair. It will be considered unfair where there was inadequate disclosure of:

a. a discretionary commission arrangement, where the broker could adjust the interest rate the customer would pay in order to obtain a higher commission;

b. a high commission arrangement, where the commission is equal to or greater than 35% of the total cost of credit and 10% of the loan; and/or

c. tied arrangements that gave the lender exclusivity or a first right of refusal.

3. Redress calculation: Compensation will be awarded to consumers in one of two ways – for cases that closely match the Johnson fact pattern (i.e. involving both a contractual tie and a very high commission), consumers will receive a refund of the full commission paid plus interest. For all other cases, compensation will be calculated as the average of two amounts – a reduction in the APR by 17% and the total commission paid.

4. Payment: Provisional redress decisions will be sent to consumers, who have one month to object. Final determinations and payments follow within one month.

The consultation will remain open until 18 November 2025. However, the deadline to submit comments specifically on the FCA's proposals to further extend the timeframe for firms to provide a final response is 4 November 2025. The proposed changes are in a new chapter in the Consumer Redress Schemes sourcebook (CONRED).

The FCA plans to publish its policy statement and final rules by early 2026. The scheme would launch at the same time, with consumers starting to receive compensation later in 2026.

10. FCA publishes expectations for firms ahead of potential motor finance redress scheme

On 7 October 2025, the FCA issued a letter to Claims Management Companies (CMCs) outlining how they must prepare for a proposed industry-wide redress scheme for motor finance commission claims. The FCA highlighted key areas of concern for CMCs, including misleading promotions (such as inflated claim values or “guaranteed” refunds), inadequate pre-contract disclosures (notably failure to obtain the signed statement required by CMCOB 4.3.1R(1A)), multiple representation where customers unknowingly instruct more than one CMC, excessive or unclear termination fees, and a general failure to deliver fair value under the Consumer Duty. CMCs are expected to review their advertising, unwind non-compliant contracts at no cost where necessary, allow customers to exit contracts to claim directly under the forthcoming scheme, cooperate with lenders and brokers, and be able to justify that any fees charged are proportionate. Non-compliance will trigger supervisory or enforcement action.

In tangent with its letter to CMCs, the FCA instructed all lenders and brokers active since 2007 to resolve existing complaints and prepare their systems for a large-scale, potentially automated, compensation exercise.

The expectations set out by the FCA include:

• clearing the current backlog of complaints (with leasing complaints requiring final responses by 5 December 2025, and other commission complaints potentially benefitting from a proposed extension to 31 July 2026);
• mapping and tracing all impacted customers, including where loan books have been sold;
• planning how to plug data gaps, such as by using credit reference agencies or other third parties;
• cross-collaborating with broker or lender counterparties to gather information;
• strengthening case-handling controls and exploring technology to deliver redress at scale;
• maintaining adequate financial and non-financial resources, provisioning for contingent liabilities, and avoiding capital extractions that would hinder redress; and
• ensuring Senior Managers oversee preparations and provide robust second- and third-line challenge.

Firms must engage with the FCA in an open, cooperative manner and notify the regulator promptly if concerns arise. Failure to prepare will lead to supervisory or enforcement intervention.

Digital Finance and Fintech

11. ESMA publishes new Q&As on MiCAR

On 17 October 2025, ESMA published a set of Q&As in relation to MiCAR and the European Market Infrastructure Regulation (EMIR). In summary:

• Distinguishing crypto-asset execution services: ESMA states that regulators must focus on the provider's actual order-handling flow, not its contractual labels. Where the facts are unclear and the client is retail, regulators should presume the CASP is acting as agent and therefore provides execution services.
• Offerors and CASPs' responsibilities with respect to cryptoassets (other than ARTs and EMTs) that were admitted to trading prior to 30 December 2024: offerors and persons seeking admission to trading only need to comply with the marketing rules under MiCAR; they do not have to produce a white paper. Operators of trading platforms must ensure there is a white paper by 31 December 2027. Both operators of trading platforms and other CASPs mentioned in Article 66(3) MiCAR need to publish a hyperlink to any existing (registered) white paper.

12. IOSCO and FSB review regulatory gaps in global crypto and digital asset markets

On 16 October 2025, the International Organization of Securities Commissions (IOSCO) and the Financial Stability Board (FSB) each published a report (here and here, respectively) and a joint note with high-level recommendations for the regulatory framework and oversight of crypto-asset activities and global stablecoins.

Whilst IOSCO and FSB highlighted progress that has been made in establishing regulatory and supervisory frameworks over crypto-asset markets, they also identify challenges that require further attention. These include incomplete and uneven implementation, whereby some countries have advanced frameworks in place, while others lag behind. This may create opportunities for regulatory arbitrage and undermine the effectiveness of international standards.

IOSCO and the FSB call for jurisdictions to accelerate their efforts to close these gaps, enhance investor protection, and strengthen international collaboration to address the evolving risks in the sector.

13. FCA consults on progressing fund tokenisation and direct dealing in authorised funds

On 14 October 2025, the FCA published a consultation paper (CP25/28), outlining proposals to accelerate the adoption of fund tokenisation in the UK. The aim is to modernise the UK’s asset management sector by enabling distributed ledger technology (DLT) in authorised funds, driving operational efficiency and innovation, while upholding consumer protection and market integrity. This supports the UK’s ambition to be a global leader in asset management and digital assets.

Key amendments and proposals include:

• Guidance for tokenised funds: the FCA proposes new guidance clarifying how authorised fund managers can use DLT to operate fund registers. This includes the use of both private and public blockchains, provided that regulatory outcomes are achieved;
• Direct to fund (D2F) dealing model: the FCA proposes an optional new dealing model that allows investors to transact directly with the fund (or its depositary) acting as principal, rather than through the authorised fund manager. This is intended to reduce operational complexity, lower costs, and align UK practice with international standards;
• Tokenisation roadmap: the paper sets out a roadmap for further fund tokenisation, including support for fully on-chain investment markets and the use of tokenised money market fund units as collateral. The FCA confirms that tokenised assets and public DLT networks can be used, provided regulatory requirements are met;
• Use of digital cash and stablecoin: the FCA is considering interim measures to allow funds to use digital cash instruments and stablecoins for operational purposes ahead of the finalisation of the UK’s stablecoin regulatory regime; and
• Future regulatory adjustments: the FCA discusses potential future changes to regulation to support more advanced tokenisation models, including retail-scale portfolio management driven by DLT and the use of composable finance.

Comments on Chapters 2 to 4 of the consultation are due by 21 November 2025, and on Chapter 5 by 12 December 2025. The FCA will review feedback and aims to publish final regulatory requirements in the first half of 2026.

14. FCA announces partnership to accelerate open finance delivery

On 13 October 2025, the FCA announced a new partnership to accelerate the delivery of open finance in the UK, alongside the launch of two TechSprints focusing on mortgages and small and medium-sized enterprises (SMEs). This announcement follows the FCA's January 2025 commitment to the Prime Minister to leverage its regulatory powers to advance open finance, with a particular focus on supporting lending to SMEs.

In partnership with Raidiam, the FCA will provide a stable testing environment for participants in the Smart Data Accelerator (launched in September), supporting the development of safe and innovative data-sharing solutions. The Smart Data Accelerator is an extension of the FCA's sandbox, allowing participants and the FCA to test real uses of open finance in practice.

The TechSprints will run from Monday 17 November 2025 to Thursday 12 February 2026. Applications to participate must be submitted by 2 November 2025.

The FCA plans to publish a comprehensive open finance roadmap by March 2026.

15. EBA issues opinion on Commission’s proposed amendments to MiCAR liquidity requirements for reserve assets

On 10 October 2025, the EBA published two opinions on the European Commission's proposed amendments to the draft RTS specifying the composition and liquidity requirements for the reserve of assets under the Markets in Crypto-assets Regulation (MiCAR). The EBA had previously submitted its draft RTS to ensure that asset-referenced tokens (ART) issuers maintain high liquidity and prudential standards.

The EBA largely supported the proposed drafting clarifications by the Commission, but considered that substantive amendments would introduce material liquidity risk, weaken alignment with the banking liquidity framework, and open scope for regulatory arbitrage.

For example, the EBA commented that the Commission's amendments could be read as allowing ART issuers to invest reserve funds in commodities or other referenced assets, which the EBA finds incompatible with MiCA's requirements for high liquidity and immediate convertability. In addition, the amendments could introduce liquidity risk by allowing the investment into non-Highly Liquid Financial Instruments (HLFI) for the purposes of constituting reserve assets.

The Commission will now consider the EBA's feedback before finalising and adopting the delegated act, which will then be published in the Official Journal of the European Union.

16. FCA publishes research note on Open Banking and Open Finance in the UK

On 6 October 2025, the FCA published a research note, supported by KPMG and Europe Economics, reviewing the current state of open banking in the UK and exploring the strategic case for expanding to open finance. Open banking allows consumers and businesses to share their financial data securely with third parties via Application Programming Interfaces (APIs), aiming to boost competition and innovation in financial services. The note also looks at how open finance could extend these benefits to a wider range of financial products.

Key findings from the research include the following:

• open banking has improved consumer choice and innovation, but uptake varies across different groups;
• the research identifies a need for more standardisation and better data quality;
• open finance could promote economic growth, competition and financial inclusion by allowing data sharing across sectors such as insurance, mortgages, investments, pensions, savings and consumer credit; and
• the note stresses the importance of strong consumer protections and clear consent mechanisms.

The research note does not reflect FCA views or policy positions. The FCA will reflect on the findings to inform its long-term strategy and framework for open banking. Following the Data Use and Access Act 2025 coming into force, the FCA is working with HM Treasury to ensure effective regulation in this sector.

Payments

17. European Commission adopts Implementing Technical Standards on reporting charges on credit transfers

On 1 October 2025, the European Commission adopted Commission Implementing Regulation (EU) 2025/1979, setting out the first harmonised implementing technical standards (ITS) under Article 15(5) of the Single Euro Payments Area Regulation (EU) 260/2012 (SEPA Regulation). The SEPA Regulation and this ITS introduce a single EU-wide framework—comprising standardised templates, detailed instructions and a common methodology for payment service providers (PSPs) to report annually on:

• the level of charges applied to credit transfers, instant credit transfers and payment accounts; and
• the share of instant credit transfers rejected or frozen owing to EU targeted financial restrictive measures.

Key points in the ITS include:

• Scope and addressees: All PSPs operating in EU Member States must report at entity level. Branches report to host-state authorities, while parent entities report to home-state authorities. PSPs in non-euro Member States that offer euro credit transfers must report both euro and local-currency data.
• Reporting content: Annex I provides six standard templates covering (i) number and value of credit transfers; (ii) associated charges; (iii) number of payment accounts and related charges; and (iv) instances of rejected instant credit transfers. Data must be broken down by domestic/cross-border nature, payment initiation channel, consumer/non-consumer status and whether transfers were free or paid-for.
• First reference period: The inaugural submission must back-fill data for 26 October 2022 – 31 December 2022 and each subsequent full calendar year up to the end of the year preceding the first report.
• Data quality: PSPs must follow the EBA’s datapoint model and validation rules. Figures must be aggregated at annual level, with monetary amounts reported in thousands of units and integer fields reported without decimals.
• Currency treatment: Charges for euro-denominated transfers are always reported in euro, irrespective of the currency actually levied. Charges for transfers in other national currencies are reported in that currency. Currency-conversion fees are excluded.
• Rejected instant transfers: PSPs must disclose the annual number of rejected or frozen instant credit transfers, split by payer/payee PSP and by domestic/cross-border scope, to help the Commission gauge any impact from sanctions screening obligations introduced by Regulation (EU) 2024/886.
• Implementation timeline: The Regulation enters into force on the twentieth day after publication in the Official Journal. The first harmonised reports will therefore be due in 2026, covering the back-filled 2022-2025 data series. Subsequent reports will contain only the preceding calendar year’s data.

The new ITS aim to give the Commission a consistent evidence base for future evaluations of fee-level convergence, the impact of mandatory instant payments and the effectiveness of sanctions-screening measures across the Union’s retail payments market.

ESG

No new entries.

Other

No new entries.