A decade on from the 2008 financial crisis and its effects are still being felt. While the credit crunch undoubtedly caused a lot of economic grief for both global corporations and private individuals, emphatic calls for greater regulatory oversight in the financial services industry have benefitted consumers and companies alike. By closing off loopholes and back channels that prioritized short-term gains at the expense of customer transparency, new regulations put the user at the front and center of financial services businesses like accountancy firms, insurance companies, and brokers.
These regulatory changes represent a crucial step in the industry’s road to redemption. Firms that comply with these new, more stringent standards can apply for accreditation from the appropriate regulatory body. This provides much-needed reassurance for consumers, who can relax knowing that they are working with a responsible firm that prioritizes the protection of clients and client funds. Global, award-winning broker FXTM recently joined the ranks of industry-leading firms who have been awarded a Financial Conduct Authority (FCA)licensee.
The FCA is the UK’s leading financial regulatory body, overseeing more than 56,000 companies and 125,000 individuals (collectively representing approximately 12% of the UK’s GDP). The FCA works in close association with various European regulators like ESMA (the European Securities and Exchange Commission) to ensure that the standards it sets are consistent with international regulation, in particular, MiFID II (Markets in Financial Instruments Directive) and GDPR (General Data Protection Regulation).
Although FXTM already holds licences from both CySEC (Cyprus Securities and Exchange Commission) and South Africa’s FSB (Financial Services Board), earning FCA approval is an important next step for the fast-growing company. FXTM Director Martin Couper explains why: “There were many good reasons to apply for the FCA licence, not least of which was our desire to reassure our clients that they are dealing with a fully-compliant, fully-regulated broker. Financial services companies now operate under the weight of a significant compliance mandate. We are thrilled to have qualified and are looking forward to operating in the UK.”
Holding this licence will allow the company to expand into new markets, something it is already doing at an accelerated rate. FXTM reported a 77% year-on-year increase in its client base in 2017, along with a 64% surge in the number of active users. The company’s commitment to training clients with a comprehensive programme of Ebooks, seminars and educational events, as well as multilingual customer support and localised services, is to thank for its success, says Couper. “We have always believed that an educated client is our best client; therefore, developing materials that will enhance traders’ knowledge of trading and markets is a top priority. We look forward to providing our UK traders with the same standard of services and education as our existing global clients.”
Recognition by the FCA is of particular significance for firms that seek to operate in the UK and, more generally, across the European Union. Ongoing uncertainty caused by Brexit is another time-sensitive motivator for FXTM. Couper elaborates, “We want to make sure that potential new legislation does not interrupt the services we provide to our clients. How international companies will operate post-Brexit is unclear, so we deemed it prudent to ensure there are strategic plans in place that guarantee business-as-usual for our clients, whatever shape the final Brexit agreement takes.”