The Financial Conduct Authority (FCA) must continue to embrace innovation whilst levelling the playing field for firms who stick to the rules, said the organisation’s chief executive at UK FinTech Week.

In a speech Nikhil Rathi said that the organisation must help new entrants test innovative ideas and gain regulatory approval, because “this can do so much for consumers
looking for easier access to services and new ways of transacting.”

The regulator must also ensure that those firms who abide by the rules aren't put at a disadvantage by those who don't, said Rathi.

Rathi warned that for the authority to meet its objectives over the long term, it must not only improve its structure, technology, and data analytics, but also adapt its culture and risk appetite and ‘take innovative advantage’ of its powers as a regulator.

“Our powers – and how we exercise them – must also keep pace with innovation and changes in consumer behaviour,” he said. “For example, in a low interest rate environment, we have seen a growing number of investors search for better returns online. Too many of these investment opportunities prove too good to be true.”

The FCA chief exec also reiterated the organisation’s call for the government to take action to provide better financial protection for consumers online.

He added that ultimately online search and social media firms need to take more responsibility for their role in connecting consumers with these investment offers.

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