08 July 2009 News

 

UK Treasury sets out reforms for financial markets: Technology to drive competition

The UK government has published a white paper entitled "Reforming financial markets". Within the document the government notes that innovation, partly due to the boom in new technologies has left regulators and central banks behind in their understanding of the full marketplace.

As part of the white paper, the Government also says it plans to "examine the possibilities of new technology to further encourage new entrants" to the market, noting that "While there has undoubtedly been some decline in competitive pressure as a consequence of the consolidation driven by the financial crisis it is certainly not clear that there are now insufficient suppliers to provide effective competition in the UK banking market."

It highlights the opportunity that technology provides in allowing new entrants to the UK market and stresses that regulators "should consider the impact on market access of all proposed regulatory changes and to specifically address this issue when conducting its cost benefit analyses on new proposals, so that the impacts on potential new entrants are taken into account" and that this is matched at the European level.

The full White Paper is downloadable here >