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Opinion
Research reveals broader economic uncertainty
FCA agrees phased introduction of SCA
Last month, the CBI produced its SME Trends Survey and amidst political uncertainty, it is hardly surprising to see business optimism deteriorate once again. The data shows weak activity among SME manufacturers and this is significantly impacting investment. Future investment intentions for the next
12 months remain poor, and, while it is understandable that SMEs remain cautious, spending less on buildings, plants and machinery, and innovation will make it extremely challenging for SMEs trying to compete against larger manufacturers. Our own research reflects this sentiment,
as we recently found that a fifth of UK SMEs planned to take out additional finance over the last year, but decided not to, with a quarter citing Brexit as the main cause for concern. Supporting UK SMEs in delivering
growth and achieving their ambitions is essential to driving our economy forward. We believe that the government and
finance industry have a duty to demonstrate the positive impact alternative finance can have for businesses throughout the country. This way, SMEs can continue to invest in their future and stay ahead of the curve.
Chirag Shah Chief executive, Nucleus Commercial Finance
The Financial Conduct Authority (FCA) has agreed a plan that gives the payments and e-commerce industry extra time to implement Strong Customer Authentication (SCA). From 14 September 2019, new European
Union (EU) rules will start to apply that impact the way in which banks or payment services providers verify their customers’ identity and validate specific payment instructions. The new rules, called SCA, are intended
to enhance the security of payments and limit fraud during this authentication process. The FCA last month agreed an 18-month
plan to implement SCA with the e-commerce industry of card issuers, payments firm, and online retailers. The plan reflects the recent opinion of the
European Banking Authority which set out that more time was needed to implement SCA given the complexity of the requirements, a lack of preparedness, and the potential for a significant impact on consumers. Jonathan Davidson, executive director for supervision – retail and authorisations, at the
FCA said: “We have been working with the industry to put in place stronger means of ensuring that anyone seeking to make payments is not a fraudster. “While these measures will reduce fraud,
we want to make sure that they will not cause material disruption to consumers themselves; so we have agreed a phased plan for their timely introduction.” The FCA will not take enforcement action
against firms if they do not meet the relevant requirements for SCA from 14 September 2019 in areas covered by the agreed plan, where there is evidence that they have taken the necessary steps to comply with the plan. At the end of the 18-month period, the
FCA expects all firms to have made the necessary changes and undertaken the required testing to apply SCA. The FCA will also continue to monitor
the extent to which banks and payment- service providers are meeting its expectation that they consider the impact of SCA on different groups of consumers, and provide alternative means of authentication where needed.
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www.CCRMagazine.com
September 2019
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