Regulatory Updates May 2026

Our regulatory newsletter aims to provide insight into the changes and updates which may have an impact on your firm. At Objectivus we are well positioned to provide context and support for firms working to understand such changes.

In this issue we cover:

• FCA publishes 10th edition of the Regulatory Initiatives Grid
• FCA and BoE consultation on tokenised wholesale markets
• FCA implementation of strengthened safeguarding regime for payments firms

FCA publishes 10th edition of the Regulatory Initiatives Grid

The Financial Conduct Authority (FCA) and other members of the Financial Services Regulatory Initiatives Forum have published the 10th edition of the Regulatory Initiatives Grid, setting out the regulatory pipeline for the next 24 months.

The update reflects continued efforts to improve transparency and coordination across regulators, with the Grid outlining a broad range of live initiatives across banking, payments, insurance, investment management and wholesale markets. The FCA has emphasised the importance of supporting firms in planning for regulatory change through greater visibility of upcoming initiatives and timelines.

Key themes include continued regulatory focus on supporting competitiveness and growth, strengthening financial stability and improving coordination across regulatory bodies to reduce duplication and operational burden on firms.

For firms, the publication reinforces the importance of forward planning, particularly where multiple overlapping regulatory programmes may affect operational change agendas.

FCA and BoE consultation on tokenised wholesale markets

The FCA and Bank of England (BoE) have published a joint call for input on the development of tokenised wholesale financial markets in the UK, setting out a shared vision for the evolution of market infrastructure and settlement systems.

The consultation explores potential pathways for the adoption of tokenised instruments, including bonds, equities and fund units, and seeks industry input on the regulatory, operational and technological considerations required to support wider adoption.

The paper highlights the importance of ensuring that innovation in tokenisation develops within a robust governance and risk management framework, with appropriate safeguards for market integrity, operational resilience and investor protection.

Overall, the publication signals a coordinated regulatory approach to the modernisation of wholesale market infrastructure, with a focus on enabling innovation while maintaining confidence in core financial market functions.

FCA implementation of strengthened safeguarding regime for payments firms

The FCA has begun implementing enhanced safeguarding requirements for payment and e-money institutions, representing a significant strengthening of the regulatory framework for customer funds protection.

The updated regime introduces more stringent expectations around the segregation of client funds, improved reconciliation processes and enhanced reporting requirements, particularly for larger and higher-risk firms. These measures are intended to address long-standing weaknesses identified in safeguarding practices across parts of the sector.

Firms will also be expected to demonstrate stronger governance and control frameworks, including clearer senior management accountability and more robust oversight of safeguarding arrangements.

The FCA has positioned these reforms as part of its broader objective to strengthen consumer protection and improve operational resilience within the payments sector.

Please contact us at info@objectivus.com if you have any questions or require further clarity on any of the points raised.