Tech Providers in UK Financial Services Face Direct Regulation
IT providers in the U.K.'s financial services sector will soon face increased regulations.
The goal of the Financial Services and Markets Bill is to ensure the resilience of the banking industry by better regulating the IT providers that serve them. The regulations, which come from the Bank of England's Financial Policy Committee, are designed to align with the EU's Digital Operational Resilience Act (DORA). Learn more about these coming regulations by reading this article.
What new regulations are being introduced for tech providers in the UK financial sector?
UK financial regulators are set to gain new powers to directly regulate certain technology suppliers, including cloud service providers, as part of the Financial Services and Markets Bill. This move aims to address the growing dependency on these providers in the financial sector and to ensure that businesses designated as critical third parties establish robust risk and control management frameworks similar to those required of authorized firms.
What are critical third parties (CTPs) and their significance?
Critical third parties (CTPs) are technology service providers that the UK financial services sector increasingly relies on. While their services can enhance operational resilience, the concentration of these services among a limited number of providers poses potential risks to financial stability. The new regulations aim to provide oversight and establish resilience standards for these CTPs to mitigate such risks.
How will the new regulations align with EU standards?
The new UK regulations are anticipated to align with the objectives of the EU's Digital Operational Resilience Act (DORA), which also focuses on the direct regulation of major technology providers in the financial sector. This alignment is expected to enhance regulatory consistency and address similar concerns regarding the resilience and oversight of critical technology services across both regions.
Tech Providers in UK Financial Services Face Direct Regulation
published by NGenious Solutions, Inc.
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