Today the FCA announced its plans to broaden the scope of the Senior Managers and Certification Regime (SMCR) to all authorised firms, be they the largest asset managers, consumer credit firms, payment institutions or the smallest financial adviser.

The BBA, now merged with UK Finance which represents the finance industry and banks, called for a widening of the SMCR's scope in its response to the October 2014 Fair and Efficient Markets Review consultation on the Fixed Income, Currency and Commodities markets. The proposed changes in CP 17/25 deliver this broadening of the regime's scope. So UK Finance is supportive of the FCA's aims which go to the heart of improving trust and confidence in the financial services industry, by improving culture and governance in all firms the FCA regulates.

UK Finance supports the proportionate approach the FCA is proposing to adopt. An extra 47,000 firms will be brought into the scope of the SMCR so the three tiered approach, which applies different elements of the regime differentially, is a realistic solution to a potentially mammoth task as the FCA's existing Approved Persons Regime (APER) is replaced.

Most firms will be required to apply the core regime, but about 350 of the largest will apply a version of the regime which more closely mirrors the existing SMCR for banks and insurers. And there will be a cut down ?Limited Scope? regime for non-financial organisations whose consumer credit activities are ancillary to their primary business - for instance a dentist offering a payment plan to her patients.

CP17/5 describes about the ?what and why? of expanding the scope of the SMCR, not the ?how?. The FCA expects to consult on the mechanisms by which firms should apply for authorisation for their senior managers before Christmas. But early indications are that the FCA will sensibly allow individuals already authorised under APER to transition across to the SMCR seamlessly, with no further need for form filling.

At present it is unclear when next year the expanded SMCR will come into effect. This decision is in the hands of HM Treasury but is more likely to be towards the end of 2018 than the beginning.

Whilst UK Finance's banking members will already be very familiar with the SMCR CP 17/25 does introduce a new requirement for all banks, which is that a senior manager should be accountable for ensuring that their bank trains its staff in the Conduct Rules. Additionally the FCA has helpfully clarified its approach to the ?12-week? rule, which allows colleagues to cover for an existing senior manager if s/he is unwell.

A number of UK Finance members or their subsidiaries - the SMCR applies on a legal entity basis - will not have considered the SMCR before. UK Finance represents all financial services firms and its banking members that have already implemented SMCR stand ready to support other types of firms contemplating it for the first time. Watch the UK Finance website for training events that will capitalise on this synergistic opportunity.