Philip Hammond, speaking at the Mansion House dinner, highlighted the many ways in which a no-deal Brexit would be damaging for the financial services industry and the UK as a whole. He noted also the political agreement which would rely on a broadly untested and uncertain equivalence test and also the measures the UK regulators and industry have already taken to prepare for Brexit.
But he said the future of the financial services industry is not all about Brexit, as the single market did not make the UK what it is. He focused on innovation and methods to create new ways to serve the markets and meet demands that have only just come into existence. He spoke of how policy and regulation need to evolve as the first wave of FinTech innovation matures. As part of this, Treasury will lead a review of the payments landscape, and will use the Smart Data Function to build on Open Banking, so that small businesses and consumers will have power over all their financial data.
The next stage is to plan a long-term review of the regulatory framework, first looking at improving coordination between regulatory authorities and followed by a call for evidence in the summer..