The story so far
The Financial Conduct Authority (FCA) introduced the Consumer Duty in July 2023 as a wide-ranging framework designed to ensure financial firms deliver “good outcomes” for retail customers. It set new expectations around fair value, product suitability, customer understanding, and post-sale support.
Now, according to reporting in the Financial Times (30 September 2025), the FCA is considering adjustments to reduce what it describes as an “excessive burden” on firms that do not have a direct relationship with consumers - such as infrastructure providers, B2B fintechs, and some parts of the payments chain.[1]
The regulator’s position appears to be that the Duty’s scope and proportionality need review, especially for entities operating behind the scenes rather than those selling or advising consumers directly.
Why this matters
At Asima, we see two threads in this development: one regulatory and one strategic.
From a regulatory standpoint, the proposed easing is not a rollback of consumer protection. Rather, it’s a move toward clarity and proportionality. Firms that build and maintain infrastructure (like Asima) are often several layers removed from the retail relationship, yet must currently interpret obligations designed for customer-facing firms.
From a strategic standpoint, there’s a risk: less clarity can breed complacency. If certain entities are exempted or less closely supervised, the chain of accountability can weaken. In an interconnected ecosystem, where data, payments, and digital identity often move through multiple regulated entities, that clarity is essential.
“Fintech infrastructure firms like ours already operate under strong prudential and conduct frameworks, but proportionality matters. The goal should be clear accountability, not duplicated compliance. It’s about aligning duty with control.” ~ Carmen James, Head of Operations, Asima.
The heart of the Consumer Duty
The Consumer Duty rests on three core principles:
- Acting in good faith toward retail customers.
- Avoiding foreseeable harm to customers.
- Supporting customers to pursue their financial objectives.
These principles are supported by four cross-cutting outcomes:
- Products and services
- Price and value
- Consumer understanding
- Consumer support
Under the current rules, firms in the distribution chain - such as technology providers and payment processors - are required to ensure their design and delivery processes support those outcomes, even if they never interact directly with end users.[2]
That broad scope has raised questions about who is ultimately responsible for consumer outcomes and how far upstream the obligations should extend.
A case for calibration, not relaxation
Fintechs operating as suppliers to authorised firms have argued that they should not shoulder the same obligations as those holding the customer relationship. The FCA appears to agree in principle, proposing a more calibrated model where responsibility scales with control.
But this shift will need careful drafting to avoid introducing regulatory grey zones. Payment processors, data aggregators, and API infrastructure providers are not invisible—they shape pricing, data quality, and resilience, all of which directly affect outcomes.
“Consumer Duty was never meant to be a blunt instrument. If the FCA can balance proportionality with accountability, it strengthens - not weakens - the regime.” ~ Kieron James, CEO, Asima
The Asima view
We welcome proportionate regulation. The Duty was designed for retail firms but inevitably captured B2B providers whose risk to consumers is indirect. Clarifying that scope will reduce duplication and uncertainty.
However, the underlying ethos of transparency, fair value, and reliability should remain. In open banking, infrastructure failures or opaque pricing models can still produce poor consumer outcomes, even when no consumer relationship exists on paper.
Our belief is that well-defined accountability beats over-broad obligation. It encourages innovation without sacrificing trust.
What fintechs should do now
- Stay engaged: Respond to the FCA consultation when it opens. Articulate clearly where your firm’s responsibilities begin and end.
- Maintain documentation: Even if obligations ease, firms will still need to demonstrate how their operations support fair outcomes for end users.
- Revisit contracts: Review how duties are allocated across your value chain—especially in white-label or embedded finance models.
- Keep the cultural intent: Compliance is not just procedural. The best fintechs embed customer protection as part of product design.
Looking ahead
The FCA’s consultation is expected in Q4 2025, with final guidance likely in 2026. If handled well, the result could be a leaner, clearer regulatory framework that preserves consumer protection while encouraging innovation.
For fintechs and infrastructure firms alike, this is an opportunity to help shape a regime that recognises both responsibility and proportionality - and to show that doing the right thing for consumers can still align with commercial success.
- Financial Times, “FCA seeks to loosen UK consumer protection rules to relieve ‘excessive burden’,” 30 September 2025. Link ↩︎
- Financial Conduct Authority, FG22/5: Finalised Guidance for firms on the Consumer Duty, July 2023. Link ↩︎
