The FCA is set to impose a cap on charges by payday lenders of around £30 for each £100 borrowed, according to the Financial Times.
Its consultation will set out proposed rules for a charge cap, with a implementation planned in early 2015.
In February the FCA introduced new rules including limiting the number of times a payday lender can rollover loans to two, and restricting the number of times a firm can seek repayment using a continuous payment authority to two.
It said at the time it would consult on a charge cap in the summer.
Payday lenders have come under increased pressure recently.
Last week the Financial Ombudsman Service released new statistics showing the number of complaints about payday lenders had rocketed, warning it was only the “tip of the iceburg”.
The figures came after the FCA announced payday lender Wonga would pay £2.6m in client redress after it sent out letters from fictitious law firms demanding debt repayment.