A Bill to make provision about the regulation of financial services and markets; and for connected purposes.
House of Lords
21 May 2026
May contain errors — check source documents for definitive information.
The Financial Services and Markets Bill aims to modernise and simplify UK financial regulation. It brings together several regulators, expands consumer protections and ombudsman powers, extends regulation to cryptoassets and cross‑border activities, and changes how payment systems are overseen. The bill is currently at the Lords’ 2nd reading stage, with Lords amendments being debated and votes taking place in the Commons on whether to accept or reject them.
The bill progressed from 1st reading in the Lords (May 19, 2026) to its 2nd reading in the Lords (June 8, 2026). It will move to committee stage and further House of Commons consideration, subject to amendments and debate. The document trail indicates wide reforms with detailed secondary‑legislation plans and safeguards.
In the Commons’ votes on Lords amendments, the government (led by the Conservative party) voted in favour on all three motions and opposed some Lords amendments. The motion to agree with Lords Amendment 38 passed (303 Aye, 36 No). The motions to disagree with Lords Amendments 10 and 7 also passed on Aye votes (303 Aye to 201 No; 301 Aye to 48 No), indicating broad government support for most amendments but a preference to reject some Lords changes. Opposition parties, notably Labour and Lib Dems, largely voted No on the two disputed amendments, reflecting a broad cross‑party split on specific changes.
Generated 20 May 2026
19 May 2026
8 Jun 2026
Based on 3 recorded votes • Sorted by % Aye
First reading took place on 19 May. This stage is a formality that signals the start of the bill's journey through the Lords.
What happens next?
Second reading - the general debate on all aspects of the bill - is scheduled for 8 June.
The memorandum explains that the Financial Services and Markets Bill would grant the Treasury and regulators broad delegated powers to implement wide-ranging reforms—covering consumer credit, access to banking, the ombudsman scheme, the new payment systems framework, AML/CTF supervision, overseas recognition, Gibraltar arrangements, ring-fencing, CCDS, transformer/insurance vehicles and cryptoassets. It justifies these powers as necessary for flexible, timely regulation in a fast-changing sector, outlines the parliamentary procedures and safeguards (distinguishing when Parliament approval is needed vs regulator rule-making), and sets out transitional and commencement arrangements.
The Financial Services and Markets Bill introduces sweeping reforms to UK financial regulation, including a new framework for the ombudsman with an appointment process and powers to refer matters to the FCA. It creates long‑term strategy duties for the FCA and PRA, and expands consumer redress and ombudsman provisions. It also overhauls payment systems oversight—designating regulated payment systems, reassigning roles among the FCA, PRA and Bank of England, abolishing the Payment Systems Regulator, and extending regulation to cryptoassets and cross‑border activities.
An overarching Impact Assessment for the Financial Services and Markets Bill outlines a package of measures to streamline regulation, modernise protections and boost UK financial services growth. It favours a set of primary-legislation reforms (e.g., consolidating the PSR into the FCA, FOS and SM&CR reforms, ring-fencing updates, CCA revision, AML supervision reform, CCDS improvements, and overseas recognition regimes), with most details to be defined via secondary legislation and regulator rules. The analysis projects a substantial net welfare gain (central NPSV about £1.6 billion) and expected reductions in firms’ administrative costs, though many benefits are contingent on future regulator implementation and are subject to ongoing monitoring and evaluation.
The Financial Services and Markets Bill [HL] would modernise UK financial regulation by folding the Payment Systems Regulator into the FCA, moving many Consumer Credit Act 1974 protections into FCA rules, and reforming the Financial Ombudsman Service to align with FCA standards. It also introduces a provisional licences regime to help new firms reach full authorisation, expands the Appointed Representatives regime, and reforms the Senior Managers and Certification Regime to reduce red tape while preserving accountability. In addition, the Bill reforms AML/CTF supervision by bringing it under the FCA, updates the ring-fencing framework, creates Overseas Recognition Regimes and a Gibraltar regime, and grants new powers to regulate cryptoassets, transformer vehicles and insurance vehicles, alongside changes to payment systems regulation within FSMA.
The Treasury’s ECHR memorandum concludes the Financial Services and Markets Bill is compatible with the European Convention on Human Rights, subject to safeguards. It highlights major changes such as an overriding ten-year time limit for Financial Ombudsman Service complaints, a mechanism to refer questions to the FCA to align FOS with FCA rules, and the abolition of the Payment Systems Regulator with its functions folded into the FCA (including potential price controls), plus a consolidation of AML/CTF supervision under the FCA with new information-sharing powers, a framework for temporary Part 4A permissions, and a power to update cryptoasset provisions under POCA/TACT/ATCSA. The document stresses that these measures are justified and proportionate, with safeguards including judicial review, data protection compliance, and built-in consultation and notice provisions.
