How to obtain a finance license

This article looks at how to obtain a finance license.

According to the Financial Services and Markets Act (FSMA) 2000, financial activities must be regulated by the Financial Conduct Authority (FCA). If you wish to carry our a regulated financial activity you must apply to become regulated by the FCA by obtaining the appropriate license. Banks and insurance companies are regulated by both the FCA and the Bank of England through the Prudential Regulation Authority (PRA).

1. Timeframe: how long it takes to obtain a license

The application assessment stage takes up to 6 months if you have submitted a completed and thorough application. However, where an application is considered as not being complete it can then take up to 12 months for your application to be assessed. When you apply you must also pay an application fee to the regulator. The fee amount will depend on the type of regulated service you wish to provide and your forecasted turnover.

2. Regulated financial activities

You must first decide what type of financial services firm you wish to become.

The following is a list of financial services firm types:

a. Banks and credit unions

b. Claims management companies

c. Consumer credit firms

d. Electronic money firms

e. Financial advisers

f. Insurers

g. Investment management firms

h. Life insurers and pension providers

i. Mortgage lenders and brokers

j. Payment institutions

k. Wealth managers

3. Preparing and completing your license