The Financial Conduct Authority will lift its levy on home finance providers, advisers and arrangers by 10.4% to £21m in its 2023/24 business year.
The City watchdog says the rise will ensure it is “adequately resourced to manage its expanding remit,” as well as inflation and “the transfer of previously retained EU financial services law into our regulation”.
The higher fees come as the regulator’s annual budget rises to £684.2m, up 9.5% from a year ago, with which it will oversee the UK’s 60,000 regulated financial firms, including the mortgage industry’s roughly 100 lenders and 18,000 brokers and broker firms.
New charges that the body did not account for last year, include a £5.3m cost for Consumer Duty and £12.7m for the post-Brexit future regulatory framework, which it says will ensure that “the UK’s regulatory framework for financial services continues to be coherent, agile, and internationally respected”.
It estimates that the levy on appointed representative firms will remain flat at £7.1m, with each appointed representative subject to a £266 fee, or £80 for introducer appointed representatives.
The regulator says: “We recognise that many businesses, including those we regulate, are facing cost pressures.
“As a result, we propose freezing minimum and flat rate fees to ease the pressure on the smallest firms. We are also freezing our application fees this year.”
This means mortgage brokers, and other types of advisors, will see minimum and flat-rate fees frozen as the body previously proposed in November.
But it adds: “Next year, we expect to return to our practice of increasing minimum and flat rate fees in line with ongoing regulatory activities.”
