New financial services firms are having to wait over five months to be authorised by the FSA, more than three times as long as they had to wait before the financial crisis.
A freedom of information request from law firm Reynolds Porter Chamberlain reveals firms are having to wait a record 22.9 weeks for authorisation, compared to 19.6 weeks between January and March this year and a previous peak of 21.1 weeks in Q2 2010.
FSA director of authorisations Victoria Raffé told the Financial Times: “Of course we want to authorise firms quickly, but we also have to be tough at the gateway to ensure the right firms get authorised.
“There is a balance to be struck between speed on the one hand and protecting consumers and the wider financial system on the other.”
RPC regulatory partner Richard Burger says: “The FSA is undergoing a major overhaul and it looks like the reorganisation is having an effect on the organisation’s ability to process approval applications. The current wait times could be putting a real brake on UK innovation.
“This overlapping period before the new regulators are in place is an opportunity for them to overhaul the process of approval, rather than simply follow the mould of their predecessors.”
RPC said in June that if there was a significant increase in FSA authorisation times in Q2, it would be a “worrying sign that the twin peaks’ reorganisation is harming the FSA’s productivity.”