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Regulation is a balancing act

Shadow financial secretary to the Treasury Mark Hoban warned that over-regulating financial services will increase provider costs and lead to consumer detriment.

Speaking at an Adam Smith Institute and Finance & Leasing Association event at the Conservative Party conference in Manchester, Hoban said Government and regulators face a challenge in getting the balance of regulation right.

However, he said that regulating previously unregulated sectors can greatly improve the consumer experience.

He said: “I think the challenge is to make sure the regulatory framework does not overly impinge on some of the other aspects, such as competition between providers, innovation and choice.

“A regulatory system that imposes high costs on providers will actually force people out of the sector, reduce the number of product providers and be to the consumers’ detriment if there are fewer people in there offering a range of insurance products and savings vehicles.

“On the other hand, there are certain sectors where respected providers come into the market because it is regulated. One of the areas that has been of huge untapped potential is equity release, where a number of larger players entered this market once they felt it had been properly regulated and that led to a flexible range of products consumers could buy.”


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  1. A nice bit of generalised flag waving, but what does he propose actually doing about the FSA other than scrapping it, which will achieve nothing but incur massive costs to set up a cluster of different regulatory bodies in its place?

    To all other IFA’s out there ~ write to Mark Hoban to let him know your views. If you don’t, then you’ll have no right to complain about what may or may not happen.

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