However, the FSA has conceded that many firms will need time to get their technology up to date. It has therefore decided that MER will start on1 April 2005 for firms, giving a full year to prepare. Smaller firms (those with an annual income of under £60k in the previous financial year) will not have to submit a half-year report in the first year of regulation, but will have to report six monthly after this.
Sarah Wilson, FSA director of High Street Firms, said: “We need to have a clear picture of what is happening in the market place to help us spot problems early on and determine whether action needs to be taken. That is why we are asking firms to provide us with information on a regular basis.”
Chris Cummings, director of AMI, said: “We are urging the FSA to use the information they obtain from these reports to give detailed analysis of the industry back to firms. AMI are also consulting with the Department of Trade and Industry (DTI) to see if grants are available for smaller firms who need investment in their IT infrastructure.”
The FSA has also moved forward with its training and competence (T&C) proposals. It is seeking to move from ‘approved’ to ‘appropriate’ exams. This would mean that firms could design their own exams when training staff.
Cummings criticised the move saying it undermined the industry’s move towards professionalism.
He did however welcome the FSA’s announcement that there would be an extra exam for intermediaries seeking to advise on lifetime mortgages.
