About the roundtable
- Date: 17 July 2024
- Location: PRA
The PRA announced that it would host a pilot roundtable on innovation at the PRA’s 2023 conference on the role of financial regulation in international competitiveness and growth.
The aim of the roundtable was to gather industry views regarding the interaction between innovation and prudential regulation, and also how the PRA can best work together with industry to facilitate innovation for the benefit of the wider UK economy.
The PRA is committed to responding effectively to new opportunities and potential risks from innovation. The PRA therefore welcomes the insights that firms can provide to inform its understanding and assessment of emerging issues, and accordingly how the prudential framework could be updated.
Discussions at the pilot roundtable covered a range of questions including:
- What are the key regulatory-related factors which affect firms’ decisions when investing in innovative activities? To what extent are there trade-offs in addressing these factors?
- What are some of the regulatory tools that that the PRA could employ to help facilitate firms to innovate safely over the coming years?
- How could the PRA best work with industry to inform its approach to facilitating innovation? Are there examples of engagement methods which have worked particularly well?
Roundtable participants provided valuable insights during the discussions, including on the possible trade-off between adopting a principles-based approach to regulation and providing greater clarity in the PRA’s rules. Participants also discussed the mechanisms for enabling effective engagement between the PRA and industry on innovation, the importance of proportionality in PRA rules and of coordinating with other UK authorities to ensure complementarity of regulation in new policy areas. Participants welcomed the roundtable as an opportunity for the insurance and banking sectors to debate key topics with the regulator and facilitate a culture that embraces innovation.