Regulation

Financial regulation in the UK is split between a handful of bodies, each with a different job. The Financial Conduct Authority (FCA) is the conduct regulator: it supervises how banks, lenders, insurers, advisers and trading platforms treat customers¹. The Bank of England sits behind the system: it sets Bank Rate, targets 2% inflation, and through the Prudential Regulation Authority (PRA) checks that firms are run safely³. Two specialist regulators cover payments and pensions: the Payment Systems Regulator (PSR) oversees card payments, cash access and scam reimbursement data, while The Pensions Regulator supervises workplace pension schemes⁶.

For a consumer, the practical point is this: regulators set and enforce the rules, but they generally do not sort out your individual problem. Complaints about a specific firm go to the firm first and then, if unresolved, to the free and independent Financial Ombudsman Service⁹. Compensation when a firm fails comes from the Financial Services Compensation Scheme (FSCS), whose limits are set by the FCA and the PRA¹⁰. This page explains who does what, what protections each regime gives you across England, Scotland, Wales and Northern Ireland, and where to go when something goes wrong.

Who regulates financial services in the UK

The starting point is that regulation of financial services is a power reserved to the UK Government, so the same overall framework applies whether you live in England, Scotland, Wales or Northern Ireland¹⁴. Within that framework, day-to-day supervision is shared. The FCA and the Bank of England's PRA together regulate organisations carrying out financial services activities such as deposit-taking and making investments, under the Financial Services and Markets Act 2000 and its Regulated Activities Order¹⁵. Credit unions in Great Britain and Northern Ireland are likewise regulated by the FCA and the PRA¹⁶.

The split of work between them matters when you want to know who to contact. The FCA looks at conduct: how firms treat customers, whether adverts are fair, whether advice is suitable. The PRA, which is part of the Bank of England, looks at safety: whether a firm holds enough capital and is run in a way that reduces its chances of getting into financial difficulty⁵. A single large bank is typically supervised by both, with each looking at different questions.

Some activities need authorisation before a firm can carry them on at all. Dealing in investments is a regulated activity in the UK, so trading platforms require authorisation from, and are regulated by, the FCA¹. All financial advisers in the UK are regulated and registered by the FCA, which matters if someone is investing on your behalf as an attorney or deputy¹⁷. The FCA also publishes contact details for regulated financial businesses, which is how you can check who you are dealing with⁹.

Compensation when things go wrong is also part of the regulatory architecture. The FCA and the PRA set the financial compensation limits and compensation rules that the FSCS operates¹⁰. So the bodies that supervise firms also decide what protection your money has if a firm fails. The dedicated page on who regulates what breaks each regulator's remit down further.

The FCA: the conduct regulator for banks, lenders and advisers

The FCA describes itself as the UK's financial services conduct regulator¹. In practice that means it writes the rulebooks that firms must follow when they lend, advise, insure and sell investments, and it takes action when firms break them. Its responsibilities include ensuring fair practice in consumer credit, which covers everything from credit cards and loans to how lenders treat borrowers in difficulty⁵. It also regulates firms providing financial advice on pensions and Self Invested Personal Pensions (SIPPs)¹⁸.

The FCA's reach extends into areas you might not expect. It will also authorise and regulate pensions dashboard operators, the services due to let people see all their pension pots in one place¹⁹. It has responded to public events with reviews of its own: a scandal over account closures prompted the FCA to review how banks close customers' accounts²⁰. When you want to check if a firm is legitimate or report a possible scam, the FCA is the go-to contact⁵.

For consumers, the FCA's work shows up in three main ways. First, rules: the FCA Handbook sets requirements on firms in areas like consumer credit, mortgages and banking conduct. Second, enforcement: the FCA can fine firms and ban individuals. Third, information: the FCA Register lets you check a firm's status before you hand over money. What it does not do is act as a complaints service for individuals, which is a common and costly misunderstanding. The page on the FCA's role for consumers covers this in detail, and what the FCA covers sets out the boundary between regulated and unregulated activity.

The Bank of England: interest rates, inflation and keeping banks safe

The Bank of England is the UK's central bank and a publicly owned body²¹. Its statutory objective is monetary (price) and financial stability, and the Government sets it a target of keeping inflation at 2%⁴. The main tool for that is Bank Rate, which the Bank describes as the core interest rate in the UK and its job to set³. When the Bank raises rates, its stated purpose is to make sure inflation comes down and stays low²².

The scale of recent change is worth knowing. The Bank of England base rate, which influences the rates banks pay individuals on their savings, increased from 0.75% to 4.25% during the tax year 2022 to 2023²³. That movement explains much of what happened to mortgage costs, savings rates and credit costs over that period. Other parts of government watch the Bank's data too: the Department for Education monitors comparable market rates using monthly data published by the Bank of England²⁴.

The Bank's second job, safety, is carried out through the PRA. As part of the Bank of England, the PRA makes sure firms do business safely and reduce their chances of getting into financial difficulty⁵. This is the prudential side of regulation: capital requirements, risk controls and supervision of the largest banks and insurers. For a consumer it is mostly invisible until it matters, because it is the reason a failed bank can be resolved with depositors protected rather than left queuing for their money. The page on the Bank of England and the PRA explains this side, and Bank Rate, inflation and the UK economy covers the interest rate side.

The Payment Systems Regulator: card payments, cash access and APP scams

The PSR is the first economic regulator to oversee payment systems, and HM Treasury has designated eight payment systems for it to regulate²⁵. Its work touches three things consumers feel directly: card fees, access to cash and fraud.

On cards, the PSR is the main competent authority for monitoring and enforcement of the UK Interchange Fee Regulation, including its caps and business rules²⁶. It is currently examining card fees to ensure businesses and consumers are getting a good deal on card payments⁷. Its market review into card scheme and processing fees found that Mastercard and Visa do not face competition, with fees rising and a lack of clarity about how much businesses will have to pay to accept card payments²⁷. Those costs feed into what shops charge, which is why the PSR's work on card interchange fees matters to shoppers. The PSR has also reminded Mastercard and Visa of the need to assure themselves of their compliance with all legal obligations, while noting it does not have the power to widen the scope of interchange fee regulation in the UK²⁸.

On cash, the PSR's stated overall aim is to support cash access, including widespread geographic access, which meets the needs of UK consumers who need or want to use cash as a payment method²⁹. It continues to oversee LINK, the ATM network, making sure people and businesses have access to cash across the UK⁷, and it monitors LINK's commitments directly, engaging with LINK where it has concerns³⁰. It works with other authorities as part of the Joint Authorities Cash Strategy Group to develop longer-term solutions to society's ongoing need for cash²⁹. During the COVID-19 period it ran work identifying and managing temporary gaps in cash provision, including a collaborative project with researchers from the University of Bristol³¹.

On fraud, the PSR publishes performance data on authorised push payment (APP) scams. Its latest report, covering 1 January 2024 to 6 October 2024, includes the UK's 14 largest banking groups in Great Britain and Northern Ireland, along with eleven other smaller firms that were in the top 20 highest receivers of fraud⁶. The data covers reimbursement to victims, money sent from victims' accounts and money received into fraudsters' accounts⁶. The PSR is also implementing new rules that will let people see how well their bank is protecting them against APP scams⁷, and it has driven additional interventions to improve data sharing to spot and prevent scams, including the roll-out of the name-checking service, Confirmation of Payee⁶. A formal consultation on its APP scams policy proposals opens in December 2026, with a decision and revised legal directions expected in May 2027.

Scam reimbursement: what the law covers and what it leaves out

If you are tricked into sending money to a scammer, the legal foundation for reimbursement is Section 72 of the Financial Services and Markets Act 2023, which covers the liability of payment service providers for fraudulent transactions and applies across the UK³². The PSR expects all Faster Payments participants to identify and share payment risk levels with other participants and to act responsibly to minimise customer harm, an approach supported by HM Treasury in its published response to the Payments Landscape Review³³.

The rules do not cover everything, and the Financial Ombudsman Service is explicit about the gaps. It can still help where reimbursement rules do not apply, such as me-to-me scams, card payments to genuine merchants, overseas payments and cash withdrawals handed to a scammer¹¹. In those cases the ombudsman looks at whether the firm treated you fairly, even though no automatic reimbursement rule applies.

The practical sequence for a scam payment is set by the PSR: the best thing to do first is contact your account provider, for example your bank⁷. Payment complaints run on a tighter clock than other complaints: the firm must get back to you within 15 days, either with a response or an explanation of why it cannot yet give one, and send a final response within 35 days, after which you can bring the complaint to the ombudsman¹¹. The scams and fraud guide covers the steps in full.

The Pensions Regulator and your workplace pension

The Pensions Regulator (TPR) is the regulator of work-based pension schemes in the UK⁸. Its statutory objectives are to protect members' benefits, reduce the risk of calls on the Pension Protection Fund, promote and improve understanding of good administration of work-based pension schemes, and maximise employer compliance with automatic enrolment duties⁸. In plain terms, it watches the scheme and the employer, not your individual investment choices.

TPR actively wants to hear from members and workers. You can report concerns about your employer or workplace pension scheme in confidence if you think they are involved in wrongdoing in an area it regulates¹⁸. That includes dishonesty or fraud in your workplace pension scheme, or significant concerns about how the scheme is being run³⁴. Missing payments and employer non-compliance are reported using a different form from other concerns³⁴.

The reporting trigger for unpaid contributions is specific: TPR accepts reports when pension contributions have not been paid into a scheme for 90 days or more³⁵. A report to TPR asks for the name and address of the employer, the employer's PAYE number if there is one, the amount of money believed to be missing and when, and any evidence held³⁵.

If the worst happens and your employer becomes insolvent, there is a route to recover pension money. You can claim for contributions which were deducted from your pay but were not paid into the scheme during the 12 months before your employer became insolvent, and you may also receive unpaid contributions payable by the employer on its own account for the same 12-month period³⁶. The page on The Pensions Regulator goes further, and pensions covers the products themselves.

What regulators do not do: individual complaints and compensation

This is the section that saves people the most wasted time. Regulators make and enforce rules; they do not usually act on your individual case. The PSR, for example, does not handle queries or complaints from consumers about individual payments⁷. Its published list of what it does not do includes dealing with consumer related issues, handling complaints about individual payments, and getting involved with financial issues beyond the payments industry²⁵.

The FCA is the same on compensation. The FCA cannot pay compensation or order a claims management company to compensate you, even if you have received poor service³⁷. Complaints about poor service are referred to the Financial Ombudsman Service instead³⁷.

That is not the whole picture, though. The FCA can use its powers under section 404 of the Act to make rules requiring authorised persons, electronic money issuers and payment service providers to establish and operate consumer redress schemes³⁸. It can also impose a requirement on an individual firm to establish and operate a scheme similar to a consumer redress scheme³⁸. These are group-level powers: they are how a whole category of affected customers can end up being compensated after a regulatory failure, rather than one person at a time.

There is also a route for complaining about the regulators themselves. The Financial Services Act 2012 requires the regulators to appoint an Independent Complaints Commissioner³⁹. So if your complaint is about how the FCA, the PRA or the Bank of England handled something, that is the channel, covered in complaining about the FCA. The comparison page FSCS or Financial Ombudsman: who to go to helps you pick the right body first time.

How to check a firm is authorised and avoid scams

Before you hand over money to any firm, two checks matter. The FSCS sets them out in order: first, check your provider is authorised by the FCA; second, find out if the particular activity that the authorised firm is carrying out for you is regulated by the PRA or the FCA⁴⁰. The second step matters because a firm can be authorised for some activities and not others, and protection follows the activity, not the firm's name.

The FCA publishes contact details for regulated financial businesses, so you can verify the firm's own stated details against the register rather than trusting a phone number on a letter or advert⁹. If you want to check if a firm is legitimate or report a possible scam, the FCA is the go-to contact⁵. This applies across the market: trading platforms require FCA authorisation because dealing in investments is a regulated activity¹, and all financial advisers in the UK are regulated and registered by the FCA¹⁷.

The rules on what counts as regulated and unregulated activity, and what protection each gives, are on regulated and unregulated investments and what the FCA covers. The FSCS's own guide to investment protection explains what its cover depends on⁴⁰.

Rules that protect you when you are in debt

Debt regulation in the UK is built on a stack of laws rather than one act. For credit unions in Great Britain, the key legislation includes the Credit Unions Act 1979, the Co-operative and Community Benefit Societies Act 2014, the Financial Services and Markets Act 2000, the FSMA 2000 (Regulated Activities) Order 2001 and the Financial Services and Markets Act 2023¹⁶. The same bodies supervise them: the FCA and the PRA regulate credit unions in Great Britain and Northern Ireland¹⁶, and mutual organisations carrying out activities such as deposit-taking and making investments are regulated by the FCA and the PRA under FSMA¹⁵.

For borrowers, the conduct side is what you feel. The FCA's responsibilities include ensuring fair practice in consumer credit⁵, which is the basis for the rules on how lenders must treat customers in financial difficulty, what they must tell you, and how arrears and collections can be handled. The FCA Handbook's consumer credit sourcebook (CONC) is where those rules live, and the page on the FCA Handbook shows how to read it.

Two things are worth knowing about the boundaries. First, regulation of financial services is reserved to the UK Government¹⁴, so the core debt protections do not differ between the nations, though court processes and some advice services do. Second, not everything that touches your money is regulated: the pages on regulated versus unregulated investments and debt advice firms set out where the line falls. Free, impartial debt help is available through the routes described in the debt guide.

How money in payment and e-money firms is safeguarded

Money you hold with a payment or e-money firm, such as a prepaid card or an app-based wallet, is not covered by the FSCS in the way bank deposits are. Instead, the law requires those firms to safeguard customer money. The Electronic Money Regulations 2011 set out how: an electronic money institution may safeguard certain relevant funds in accordance with regulation 21 and the remaining relevant funds in accordance with regulation 22⁴¹. The regulations also require that an applicant for authorisation carries on, or will carry on, at least part of its electronic money and payment service business in the United Kingdom⁴¹.

The scale of this market is large and growing. E-money institutions safeguarded approximately £26bn of relevant funds in 2024, an increase from £11bn in 2021, and the FCA estimates that payment institutions safeguarded £6bn in relevant funds on any given day in 2024¹².

The FCA has recently tightened the rules through its Supplementary Regime. Payments firms must complete a safeguarding return monthly¹². Firms that did not safeguard over £100,000 of relevant funds at any point in the previous 53 weeks will not have to arrange a safeguarding audit¹². The FCA previously estimated audit costs to payments firms of £49m and now estimates total costs of £53.3m¹². There is a 9-month implementation period from the publication of the rules before they come into force¹².

Several detailed rules shape how protection works in practice:

• The obligation to safeguard relevant funds starts as soon as the funds are received by the institution¹².
• Relevant funds received in exchange for issued e-money must be held in a separate safeguarding account from funds received for unrelated payment services¹².
• Where a foreign exchange transaction is carried out independently of any payment services, those funds do not have to be safeguarded¹².
• Electronic money institutions are required to safeguard unclaimed relevant funds for at least 6 years¹².
• An insurance policy or guarantee used as a safeguarding method must not have any condition or restriction on paying out other than the certification of the insolvency event¹².

The FCA has also proposed a Post-Repeal Regime that would introduce a statutory trust over relevant funds, relevant assets and insurance policies or guarantees used for safeguarding, and would require payments firms to receive relevant funds into a designated safeguarding account with an approved bank or the Bank of England¹². That regime is deferred: the FCA will consider the feedback alongside its review of the effectiveness of the Supplementary Regime¹². The FCA's own analysis estimates the benefit of faster access to funds as £3.6m in present value over a 10-year appraisal period, with the average time to return funds assumed to fall from 2.3 years to 1.3 years¹².

Changes coming to pensions: access age, inheritance tax and scheme transfers

Pension regulation is in the middle of several changes that will affect what you can do with your money.

The first is dashboards. The Pensions Regulator and the FCA will regulate the pension schemes and providers sharing data with dashboards, and the FCA will also authorise and regulate pensions dashboard operators¹⁹. TPR has told defined benefit and hybrid schemes to act now to get data ready for dashboards⁸, and pension providers and schemes in scope of the legislation must connect to the pensions dashboards ecosystem by 31 October 2026. The aim is that you will be able to see all your pension pots in one place.

The second is inheritance tax. Changes made by the Finance Act 2026 bring unused pension benefits and death benefits into a deceased person's estate for Inheritance Tax purposes, and the Government has run technical consultations on the supporting regulations, including on how information is shared between HMRC, pension scheme administrators and personal representatives⁴². Under the changes, pension scheme administrators will become liable for reporting and paying any Inheritance Tax due on pensions to HMRC⁴³. Pensions are due to be included when an Inheritance Tax charge is calculated from April 2027. The tax guide covers the wider picture.

The third is transfers and scheme design. The Pension Schemes Act 2021 makes provision in four areas: collective money purchase benefits, The Pensions Regulator, pensions dashboards, and further provision relating to pension schemes⁴⁴. It includes regulations to stipulate destinations and circumstances for transfers, protecting members from pension scams by helping trustees of occupational pension schemes ensure transfers go to legitimate destinations⁴⁴. Collective defined contribution schemes, the new type the Act enables, are explained in CDC pensions.

On access age, pension schemes are currently required to withhold tax on payments made to scheme members after the age of 55 under pension flexibility rules³⁹. The minimum age for accessing pension savings is set to rise from 55 to 57 in 2028, so anyone planning to draw pension money in the late 2020s needs to factor that into timing decisions. The page on pension reforms in progress tracks all of these changes.

Where to complain: your firm first, then the Financial Ombudsman Service

The complaint route is the same whatever the product: complain to the firm first, then escalate. For most complaints, a business has up to 8 weeks to consider your complaint⁹. For payment complaints, including scam and fraud cases, the deadlines are tighter: a response within 15 days and a final response within 35 days¹¹. Once the firm has sent a final response, or the deadline has passed without one, you can take the complaint to the Financial Ombudsman Service¹¹.

The ombudsman is free and independent, and it can look at cases the reimbursement rules do not cover, including card payments, overseas payments and cash handed to a scammer¹¹. If your complaint is about a claims management company, for example the results of your claim or the fees charged, you complain to the Financial Ombudsman Service, and complaints about poor service are referred there³⁷.

Contact details, if you want them to hand:

• Financial Ombudsman Service consumer helpline: 0800 023 4567 (free from a landline) or 0300 123 9123 (free for mobile-phone users who pay a monthly charge for calls to numbers starting 01 or 02), Monday to Friday 8.00am to 8.00pm, Saturday 9.00am to 1.00pm; email complaint.info@financial-ombudsman.org.uk⁴⁵.
• FCA Consumer Helpline: 0800 111 6768, with information also available in large print, Braille or audio format⁴⁵.

If your complaint is about a payment specifically, the PSR's advice is the same as the ombudsman's: contact your account provider first, and contact the Financial Ombudsman Service if you are still unhappy²⁵. The comparison page Financial Ombudsman or court helps where a complaint might be worth taking further, and complaints data shows how firms' complaint figures are published.