What is the primary purpose of the Financial Conduct Authority (FCA)?

The primary purpose of the Financial Conduct Authority (FCA) is to regulate financial firms and protect consumers. This central function is vital in ensuring the integrity of the UK financial markets. The FCA establishes guidelines and standards that financial service providers must adhere to, creating a framework that maintains market order and protects consumers from unfair practices, financial losses, and potential misconduct by businesses.

By focusing on regulating financial firms, the FCA works to ensure that these entities operate fairly and transparently, which is crucial for consumer confidence in the financial system. They also enforce compliance with financial laws and regulations to mitigate risks and enhance the overall stability of the financial sector. Protecting consumers involves not only ensuring fair treatment but also promoting informed consumer decisions and enabling access to financial products and services that meet their needs.

While promoting competition in the financial market and enhancing global investment opportunities are important aspects of a healthy financial ecosystem, they are secondary to the core goal of consumer protection and firm regulation. These goals support consumer welfare indirectly but do not supersede the FCA's mandate to safeguard consumers and ensure that financial firms are operating within a regulated framework. The creation of financial policies is typically the domain of the government, not the FCA, which is primarily tasked with enforcement and oversight rather than policy-making.