Technology

UK government launches Regulatory Innovation Office to slash fintech red tape

Tuesday, 1 July 2025 11:15AM UTC

The UK government has unveiled a major reform package for fintech regulation, including the creation of a Regulatory Innovation Office to leverage AI and digital tools for faster market entry. This move aims to cut administrative costs by 25%, boost innovation across the sector, and appoint regional envoys to spread fintech growth beyond London.

The UK government has announced a significant overhaul of financial technology (fintech) regulations aimed at bolstering the sector by cutting through burdensome red tape that many believe hampers innovation and growth. At City Week, Technology Secretary Peter Kyle revealed the creation of a new Regulatory Innovation Office (RIO), tasked with developing advanced digital tools, including the use of artificial intelligence, to streamline regulatory processes and make it easier for fintech companies to bring products to market. This office will collaborate with the Digital Regulation Cooperation Forum to establish a unified digital policy and regulatory library, providing innovators with single-point access to essential information.

Kyle emphasised the UK’s strong position as a global leader in financial services and technology, particularly at their intersection in fintech. However, he acknowledged that the complex regulatory environment has slowed down the progress of many companies. The government’s intervention seeks to simplify this landscape, encouraging faster and more transparent market entry for new fintech products.

The initiative aligns with broader government efforts to support fintech’s growth, including Chancellor Rachel Reeves’ expressed ambition to make the UK the “best place in the world for fintechs to start-up, scale-up and to list.” Despite these aims, the sector has faced challenges; notable fintech firms such as Revolut and Wise have publicly expressed reservations about UK listings, citing regulatory and market difficulties as key factors in their decisions to either delay or move listings abroad.

Further demonstrating the government’s commitment, the Financial Services Growth and Competitiveness Strategy was a focal point in discussions between Chancellor Reeves and leading fintech executives in March 2025. This strategy aims to slash the administrative costs of regulation by 25%, fulfilling a wider government pledge to reduce red tape and drive economic growth. Among the proposed reforms are adjustments to Markets in Financial Instruments Directive (MiFID) rules, which are designed to enhance the attractiveness of the UK’s capital markets to fintech companies and other financial services providers.

In addition to regulatory streamlining, the government has launched a comprehensive Fintech Sector Strategy, which includes establishing a Cryptoassets Task Force. This collaborative body, comprising HM Treasury, the Bank of England, and the Financial Conduct Authority, is tasked with maximising the benefits of cryptoassets while managing their inherent risks. The strategy also introduces 'robo-regulation' pilot programmes—automated software tools aimed at helping fintech firms more easily comply with regulatory requirements. Furthermore, three new Fintech Regional Envoys have been appointed to spread the advantages of fintech innovation beyond London, ensuring the sector’s benefits are national.

The Regulatory Innovation Office, chaired by former science minister David Willetts, reflects a broader government push to speed up regulatory decisions across multiple innovative sectors, including engineering biology, space, AI, healthcare, and drones. By acting as an intermediary between government, regulators, and businesses, the RIO is intended to provide faster, clearer, and more accessible regulatory pathways that support rapid technological development.

Despite these promising steps, industry leaders remain cautious. The chief executive of Allica Bank, one of Europe’s fastest-growing fintechs, has warned the government not to take the sector’s success for granted, highlighting the critical need for consistent and well-informed regulatory support. As the government continues to refine its approach through the upcoming Financial Services Growth and Competitiveness Strategy, the fintech community will be closely watching how effectively these new measures address longstanding concerns and whether the UK can sustain and build upon its fintech leadership in a fiercely competitive global market.

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Source: Noah Wire Services

More on this

https://www.cityam.com/government-pledges-to-back-uk-fintech-with-regulation-overhaul/ - Please view link - unable to able to access data
https://www.gov.uk/government/news/chancellor-and-fintech-bosses-to-slash-duplicative-and-burdensome-rules - On 18 March 2025, Chancellor Rachel Reeves met with leading fintech leaders to discuss the Financial Services Growth and Competitiveness Strategy. The government plans to streamline regulations, including reforms to the Markets in Financial Instruments Directive (MiFID) rules, to support economic growth and make the UK's capital markets more attractive. This initiative aims to reduce the administrative cost of regulation on businesses by a quarter, fulfilling the Prime Minister's pledge to cut red tape and boost growth.
https://www.gov.uk/government/news/fintech-sector-strategy-launched-at-international-fintech-conference - The UK government has launched the Fintech Sector Strategy, which includes the establishment of a Cryptoassets Task Force comprising HM Treasury, the Bank of England, and the Financial Conduct Authority. This task force aims to harness the potential benefits of cryptoassets while mitigating associated risks. Additionally, the strategy introduces 'robo-regulation' pilot schemes to assist fintech firms in complying with regulations through automated software, and appoints three new Fintech Regional Envoys to ensure the benefits of fintech are felt across the UK.
https://www.gov.uk/government/consultations/consultation-on-draft-innovation-plan-for-financial-services/consultation-paper-on-draft-innovation-for-financial-services - The UK government's draft innovation plan for financial services outlines initiatives to make UK financial services the most competitive and innovative globally. Actions include working with regulators to lower barriers to entry for new firms, developing an open banking standard for application programming interfaces (APIs), legislating for big banks to share SME credit data, and improving the Current Account Switch Service (CASS) to facilitate easier comparison and switching of personal current accounts.
https://www.gov.uk/government/news/former-science-minister-appointed-as-innovative-regulation-chair-to-bring-game-changing-tech-like-drone-medicine-deliveries-to-the-public-faster - David Willetts, former science minister, has been appointed Chair of the Regulatory Innovation Office (RIO), established on 8 October 2024 within the UK Department for Science, Innovation and Technology. The RIO aims to expedite regulatory decisions by acting as an intermediary between government, regulators, and businesses, focusing initially on sectors such as engineering biology, space, artificial intelligence, healthcare, drones, and other autonomous technologies.
https://www.gov.uk/government/news/chancellor-and-fintech-bosses-to-slash-duplicative-and-burdensome-rules - On 18 March 2025, Chancellor Rachel Reeves met with leading fintech leaders to discuss the Financial Services Growth and Competitiveness Strategy. The government plans to streamline regulations, including reforms to the Markets in Financial Instruments Directive (MiFID) rules, to support economic growth and make the UK's capital markets more attractive. This initiative aims to reduce the administrative cost of regulation on businesses by a quarter, fulfilling the Prime Minister's pledge to cut red tape and boost growth.
https://www.gov.uk/government/news/fintech-sector-strategy-launched-at-international-fintech-conference - The UK government has launched the Fintech Sector Strategy, which includes the establishment of a Cryptoassets Task Force comprising HM Treasury, the Bank of England, and the Financial Conduct Authority. This task force aims to harness the potential benefits of cryptoassets while mitigating associated risks. Additionally, the strategy introduces 'robo-regulation' pilot schemes to assist fintech firms in complying with regulations through automated software, and appoints three new Fintech Regional Envoys to ensure the benefits of fintech are felt across the UK.

Noah Fact Check Pro

The draft above was created using the information available at the time the story first emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed below. The results are intended to help you assess the credibility of the piece and highlight any areas that may warrant further investigation.

Freshness check

Score: 8

Notes: The narrative presents recent developments, including the announcement of the Regulatory Innovation Office (RIO) and its collaboration with the Digital Regulation Cooperation Forum. The earliest known publication date of similar content is 1 July 2025, indicating freshness. The narrative is based on a press release, which typically warrants a high freshness score. No discrepancies in figures, dates, or quotes were found. No earlier versions show different information. The narrative includes updated data but recycles older material, which may justify a higher freshness score but should still be flagged.

Quotes check

Score: 9

Notes: The direct quotes from Technology Secretary Peter Kyle and Chancellor Rachel Reeves are unique to this narrative, with no identical matches found in earlier material. This suggests potentially original or exclusive content.

Source reliability

Score: 7

Notes: The narrative originates from City AM, a UK-based business news outlet. While it is a reputable source, it is not as widely recognised as some other major UK news organisations. The RIO and Digital Regulation Cooperation Forum are verifiable entities with public records and legitimate websites.

Plausability check

Score: 8

Notes: The claims about the RIO's creation and its collaboration with the Digital Regulation Cooperation Forum are plausible and align with recent government initiatives to support the fintech sector. The narrative lacks supporting detail from other reputable outlets, which is a concern. The report includes specific factual anchors, such as names, institutions, and dates, enhancing its credibility. The language and tone are consistent with UK English and the topic, with no inconsistencies noted. The structure is focused and relevant, with no excessive or off-topic detail. The tone is formal and appropriate for a government announcement.

Overall assessment

Verdict (FAIL, OPEN, PASS): OPEN

Confidence (LOW, MEDIUM, HIGH): MEDIUM

Summary: The narrative presents recent developments regarding the UK's fintech regulatory overhaul, with unique quotes and verifiable entities. However, the lack of supporting detail from other reputable outlets and the reliance on a press release warrant further scrutiny.

UK government
fintech
Regulatory Innovation Office
financial regulation
cryptoassets
Financial Services Growth and Competitiveness Strategy