Skip to main content ForewordExecutive SummaryFull Report Plan for Growth: From Strategy to Delivery Nine growth enablers to unlock finance for UK economic renewal Foreword The policy direction is established. The task now – for Government, regulators and industry in partnership – is to act decisively and deliver the financial services reforms that will help build a better society. David Postings – CEO, UK Finance For most people, the test of a strong economy is personal: being able to afford a home, access finance to start or grow a business, manage their money with confidence, and see investment in their communities delivering jobs and opportunity. Financial services reform matters because it impacts these everyday outcomes, from the cost and availability of mortgages and SME lending to the ability of households and communities to withstand economic shocks. It also matters for the UK’s wider growth ambitions. The Government’s priorities – from housing and infrastructure to industrial renewal, regional growth and clean energy – depend on a financial system able to mobilise capital at scale, support risk-taking, and channel investment to where it is most needed. Financial services are not a parallel part of the growth story; they are central to it. This requires a strong and agile financial system, anchored by a resilient core banking sector and infused with the benefits of the UK’s position as a leading international financial centre. Recognising this, the Government has responded ambitiously through its Leeds Reforms, the Financial Services Growth and Competitiveness Strategy, and a wide-ranging programme of reform spanning payments, capital markets, inclusion and housing finance. UK Finance was proud to shape this agenda through our original Plan for Growth. Where reforms have already been implemented, our members have responded enthusiastically: increasing support for first-time buyers following changes to mortgage lending rules last year; and embracing the new Targeted Support framework to improve consumers’ financial decision-making. Now that the reform agenda is established, the focus must turn to implementation. This report, which was developed with extensive input from our members, identifies nine Growth Enablers: the financial services reforms where delivery in 2026 and beyond will do most to support the Government’s wider growth strategies and deliver the greatest impact for people, businesses and the UK economy. For each, we set out what needs to be delivered, by whom and when – and where we think moving faster or going further, within the spirit of the existing agenda, would unlock even greater gains. The sector is ready to play its part. Through Covid, the Ukraine conflict and the cost-of-living pressures since, it has demonstrated what that means in practice: maintaining the flow of lending to households and businesses, supporting customers in financial difficulty through tailored forbearance, and most recently reaffirming its commitment to the Mortgage Charter to help borrowers manage repayments. In a more uncertain global environment than even a year ago, the capacity to back people, businesses and communities when it matters most is precisely what the growth mission needs. Implemented in full, these enablers will help convert national growth ambitions into practical benefits – unlocking investment in new homes and infrastructure, backing SMEs at greater scale, and providing the capital and infrastructure that UK firms need to lead in AI and the industries of the future. Executive Summary Unlocking finance for UK economic renewal Competitive mortgage rates, more businesses backed, new homes built, affordable energy bills and stronger financial resilience for households facing an uncertain world – these are the practical measures by which the Government’s growth agenda will be judged. Delivering them requires a financial system with the capacity, confidence and infrastructure to play its full role. That is the focus of this report. The Government has set a clear and ambitious programme of economic renewal and regional growth through its Modern Industrial Strategy and related strategies on infrastructure and clean energy, housing, SME support, trade, financial inclusion, and national security. Behind every one of them is a clear requirement for specific financial services capabilities. Recognising this, the Government has built an ambitious financial services reform agenda with the Leeds Reforms and Financial Services Growth and Competitiveness Strategy at its heart. UK Finance’s original Plan for Growth helped shape this agenda, and where reforms have been delivered, our members have responded. For example, mortgage reforms announced by the Financial Policy Committee (FPC) last year have helped 391,000 first-time buyers into housing, up from 332,000 in 2024. This is regulatory change working as intended – and only a foretaste of what fuller delivery could achieve. In this report, we identify nine Growth Enablers: mutually reinforcing financial services reforms that will do most to support the Government’s wider growth strategies and deliver the greatest economic impact for people, businesses and communities across the UK. These Growth Enablers do not represent a new direction of travel. Rather, they focus on locking in reforms already committed to by Government and regulators, by turning commitments into durable change; accelerating delivery where pace matters; and in some areas – such as supporting small businesses and tackling fraud – going further to match the ambition the moment demands, with new practical steps that support the Government’s existing objectives. The nine Growth Enablers are organised around three reform objectives, first set out in our original Plan for Growth and as pressing today as when we published it: Delivering a pro-growth operating environment for the financial services sector # Growth enabler Description Strategies Supported Other Growth Enablers reinforced Economic Impact 1 Reducing bank capital requirements Delivery priority Go further The FPC’s decision to revise its Tier 1 capital benchmark is welcome – but it only delivers if translated into reduced capital stacks for individual banks. The Prudential Regulation Authority (PRA) and FPC should now address overlapping capital requirements on domestic lending (which trap capital equating to £250 billion in potential lending capacity) and return the leverage ratio to its intended role as a backstop rather than a binding constraint. The PRA should also commence reviews of the mortgage risk weight framework, internal model approval speeds, and regulatory cliff edges. Housing Infrastructure Industrial SME Plan Trade National Security 7 (SME lending) 8 (financial inclusion) 9 (housing & mortgages) Lower capital requirements would reduce the structural costs of lending – improving mortgage rates and access to credit for households, and strengthening lending flows to SMEs and larger businesses, driving regional growth. 2 Completing reform of redress arrangements Delivery priority Lock in reform & move faster The Government, Financial Conduct Authority (FCA) and Financial Ombudsman Service (FOS) have committed to the most significant package of FOS reforms since its inception. The priority now is implementation, to address the existing uncertainty that feeds into product costs, constrains access to credit, restricts innovation and causes lengthy redress decisions, while harming investment in UK financial services. The FCA should rapidly finalise changes to its dispute resolution (DISP) rules, and Government should confirm primary legislation in the next King’s Speech to place reform on a durable statutory footing. Industrial Housing FinancialInclusion 7 (SME lending) 8 (financial inclusion) 9 (housing & mortgages) A more predictable and efficient redress framework means faster resolution for consumers and greater confidence for firms to invest, innovate and serve a broader range of customers – directly enabling the product and market reforms already in train to deliver their full benefit. 3 Regulatory simplification Delivery priority Lock in reform & move faster The Government’s Regulation Action Plan and decision to merge the Payment Systems Regulator (PSR) into the FCA are welcome steps towards reducing the cumulative regulatory burden that adds costs without proportionate benefit. Primary legislation is needed to lock in the PSR merger, and further reform the Senior Managers and Certification Regime, building on welcome recent steps by the regulators. The FCA should clarify the scope of the Consumer Duty to stop it from extending to wholesale markets, and together with the PRA, it should continue simplifying markets regulation. HM Treasury (HMT) should extend the 25% compliance cost reduction target to cover supervisory and tax administration burdens, and Government should further strengthen UK-EU and UK-US regulatory dialogues. Industrial Trade Infrastructure National Security 4 (payments) 5 (capital markets) 7 (SME lending) Hundreds of millions of pounds per year saved in compliance costs, redirected into growth-driving activities — and stronger international competitiveness and investment flows. Ensuring the financial system is fit for the future # Growth enabler Description Strategies Supported Other Growth Enablers reinforced Economic Impact 4 Supporting payments modernisation and innovation Delivery priority Lock in reform & go further The National Payments Vision set a clear and welcome direction, and the priority now is realising its ambition. This means operationalising the new industry-led Delivery Company (DeliveryCo) to upgrade retail payments infrastructure. It also requires HMT and the regulatory authorities to ensure sufficient regulatory flexibility for the market-led Great British Tokenised Deposits (GBTD) initiative to proceed iteratively, bringing closer the benefits of programmable, tokenised sterling deposits and on-chain settlement to support the UK’s digital finance capabilities. In addition, HMT and the FCA should finalise a new commercially sustainable open banking framework, and the Bank of England (BoE) should progress carefully with the framework for regulated stablecoins. Industrial SME Plan Financial Inclusion Trade Fraud National Security 6 (fraud prevention) 7 (SME productivity) 9 (homebuying reform) Modernised retail payments infrastructure could generate around £9bn a year in economic uplift - with additional benefits over time from delivery of GBTD - supporting SMEs productivity, financial inclusion and fraud reduction. 5 Transforming financial and capital markets Delivery priority Go further The Government’s Wholesale Financial Markets Digital Strategy and the appointment of a Wholesale Digital Markets Champion signal real ambition to position the UK at the forefront of tokenised capital markets – Mansion House is the moment to confirm that ambition, building on the strong progress towards launching a digital gilt. HMT, the Department for Work and Pensions (DWP) and regulators should implement pension schemes legislation to unlock long-term productive UK investment, while avoiding mandates that distort markets. FCA and industry should deliver T+1 settlement, share register digitisation and the consolidated tape on schedule, and merger and investment review processes should be streamlined to encourage international investment. Infrastructure Industrial Trade Housing SME Plan National Security 4 (payments infrastructure) 7 (SME growth) 9 (housing finance) Deeper, more efficient capital markets would help to mobilise the investment that the Government’s infrastructure and clean energy strategies depend on, while positioning the UK as a global hub for tokenisation would help it capture a share of a market projected to reach $3 trillion by 2030. 6 Strengthening technology and telecom firms’ fraud obligations Delivery priority Move faster & go further The Government’s Fraud Strategy sets the right direction – but the obligations on technology and telecom firms remains insufficient given the scale of fraud originating on their platforms. Ofcom should implement proactive fraud prevention obligations through delivery of fraudulent advertising rules under the Online Safety Act. Government should introduce mandatory seller verification and regulated payment options on online marketplaces, and ensure the Online Crime Centre has the accountability and transparency mechanisms to function as a genuine disruption tool. Fraud Financial Inclusion SME Plan National Security 4 (digital payments) 7 (SME e-commerce) 8 (consumer confidence) Stronger upstream obligations on technology and telecom firms could deliver a material reduction in the £450m annual cost of Authorised Push Payment fraud – and build the consumer confidence in digital payments and online commerce on which the digital economy and many SMEs depend. Unlocking financial services for people, businesses and society # Growth enabler Description Strategies Supported Other Growth Enablers reinforced Economic Impact 7 Supercharging government-backed SME support services Delivery priorityGo further The Government’s SME Plan and the British Business Bank’s (BBB) existing infrastructure provide strong foundations, but the scale of government-backed finance support remains three or four times smaller relative to GDP than equivalent schemes in the US, Germany and France. HMT, the Department for Business and Trade (DBT) and the BBB should scale the Growth Guarantee Scheme (GGS) to £5bn of annual lending and establish the Business Growth Service (BGS) as the central SME access-to-finance platform – creating a step-change in the ambition and reach of support for smaller businesses across every region. HMT’s Consumer Credit Act (CCA) review should examine how the regime currently constrains business lending, and the case for removing business lending from its scope. SME Plan Industrial Trade Housing 1 (capital & SME loan costs) 4 (payments & productivity) Scaling the GGS could unlock £4bn+ in additional SME lending each year – generating £10bn+ in new SME turnover annually, with benefits felt most strongly in the regions and communities where the Government's growth mission matters most. 8 Broadening financial inclusion for individuals and households Delivery priority Lock in reform The Government’s Financial Inclusion Strategy sets a serious commitment to ensuring financial services work for everyone, and the priority now is converting its commitments into tangible improvements. The sector is already delivering – over 220 Banking Hubs are now open, building on banks’ existing in-person presence, and UK Finance has launched the Inclusive Design Challenge, which will identify opportunities for collective industry action to remove barriers to inclusion. Key priorities now are completing the rollout of Targeted Support and maintaining momentum on the wider Advice Guidance Boundary Review, modernising the CCA through the upcoming Financial Services Bill to create a clearer and more flexible framework for consumers and firms, and making economic abuse a cross-cutting policy priority. Financial Inclusion SME Plan Industrial 2 (faster redress) 5 (retail investment) 9 (housing access) A more inclusive financial system means more people contributing to and benefiting from growth – strengthening household resilience, supporting labour market participation, and deepening the UK’s capital markets on which sustained growth depends. 9 Mobilising finance to build, retrofit and unlock housing for people Delivery priority Lock in reform & go further Progress is already visible – 391,000 first-time buyers were helped onto the housing ladder in 2025, almost 18% more than the year before, a direct consequence of mortgage rule reform. The FCA’s Mortgage Rule Review should go further, addressing rules calibrated for a different era and supporting borrowers at every stage of life. Government should embed financial services as delivery partners in homebuying and selling reform to address the one-in-three transaction failure rate, and continue collaborating with industry on the Green Home Finance Strategic Partnership to unlock the retrofit finance needed for net zero transition. Housing Infrastructure Industrial 1 (mortgage costs) 2 (product innovation) 7 (housing access) Extending homeownership to tens of thousands more creditworthy buyers annually, cutting the cost and failure rate of home transactions, and unlocking a £10bn per year retrofit opportunity – supporting over 200,000 jobs and reducing household energy bills by £2–3bn per year. Taken together, delivery of these nine enablers could unlock hundreds of billions of pounds of additional economic activity – extending homeownership, backing businesses and channelling capital into every region of the UK. But they are a package, not a menu: the enablers are mutually reinforcing, and the gains from any one of them depend partly on progress across the others. How the Growth Enablers reinforce one another: illustrated through housing and SME support The nine Growth Enablers set out in this report are not a set of independent measures. They are mutually reinforcing, and the gains from any one of them depend partly on progress across the others. Looking at two of the Government’s most prominent policy focuses – housing and homeownership, and supporting small and medium-sized enterprises – shows how this interconnection works in practice and why the enablers are best understood as a combined set. Housing and homeownership The Government’s aims to build more homes, help more people onto the housing ladder, and expand access to affordable accommodation illustrates why joined-up delivery matters. Lower bank capital requirements (Growth Enabler 1) reduce the structural cost of mortgage lending, improving affordability for borrowers.Payments modernisation and tokenisation (Growth Enablers 4 and 5) underpin the digital transaction infrastructure – including UK Finance’s GBTD pilot focused on reducing fraud risk and friction in remortgages.Capital markets transformation (Growth Enabler 5) supports funding for mortgages and financing new housing supply by enabling mortgage lending to be recycled at scale through securitisation, and institutional capital to be channelled into the projects needed to meet the Government’s housebuilding ambitions. Financial inclusion reforms (Growth Enabler 8) including Targeted Support will help more people navigate complex decisions about homeownership and housing wealth across a lifetime.Growth Enabler 9 focuses on aligning mortgage market reform, homebuying and selling reform and retrofit finance with wider housing ambitions. No single enabler delivers the housing mission alone. Each addresses a distinct constraint – on affordability, on transaction infrastructure, on access to advice, and on the supply of new and retrofitted homes – and their combined effect is greater than the sum of their parts. Supporting small and medium-sized enterprises The SME mission follows the same logic. Lower bank capital requirements (Growth Enabler 1) reduce the structural cost of lending to smaller firms, supporting more competitive borrowing costs across the market.Removing regulatory and tax compliance barriers (Growth Enabler 3) reduces the administrative burden on firms serving SMEs, freeing capacity to develop products and reach more customers.Payments modernisation (Growth Enabler 4) directly benefits SME cashflow – faster settlement, reduced transaction costs and improved business liquidity strengthen smaller firms’ ability to manage working capital and grow. For SMEs with online operations, modernised payments infrastructure supports stronger performance in the digital economy, improving customer conversion rates.Strengthening technology and telecoms firms’ fraud obligations (Growth Enabler 6) tackles fraud at source, giving consumers greater confidence to transact online and supporting the growth of e-commerce on which many smaller businesses depend.Capital markets transformation (Growth Enabler 5) bolsters the financing options available to businesses, supporting access to growth capital for businesses as they scale.Supercharging government-backed SME support (Growth Enabler 7) creates a step-change in the reach and ambition of public SME support – improving access to finance by scaling the Growth Guarantee Scheme and establishing the Business Growth Service as a joined-up access point for finance, advice and support. Taken together, these enablers address the full range of constraints that prevent smaller businesses from accessing the finance, infrastructure and support they need to start, grow and scale. The contribution of UK financial services The sector already reaches every part of the economy and every region of the country. It supports over £1.7 trillion in outstanding mortgages, provides almost £200 billion in lending and overdrafts to SMEs – with significant additional funding from asset finance and invoice finance – and processes nearly 49 billion payments each year. Over 220 Banking Hubs are now open across the UK, keeping communities connected to banking services, with the sector on track to deliver 350 hubs by the end of the Parliament. Generating around 9% of UK economic output and contributing over £43 billion in tax annually from banks alone, the sector’s productive capacity underwrites the broader economy. The UK is also the world’s largest net exporter of financial services, with £92 billion in exports annually – a position sustained by its regulatory openness, widely-used common law framework, and deep pools of professional expertise that make it a uniquely attractive international financial centre. But these figures describe what the sector delivers today, under a framework that constrains its productivity, capacity and ability to best serve customers. The reforms set out in this report would allow it to go further: extending credit to more households or at better prices, backing more businesses at scale, channelling finance into infrastructure, clean energy and national security, and strengthening the financial resilience of people across the UK. A sector operating at full strength is also the foundation on which the UK’s ambition to lead in AI-enabled services and the industries of the future depends – providing not just capital, but the payments, data and digital infrastructure that innovative businesses need to start, scale and compete. That potential will be amplified by maintaining the UK’s position as a globally connected financial centre, built for interoperability with the international systems through which capital moves. A clear path to delivery Realising the gains of reform requires not just commitment but sequenced, accountable action. The reforms set out across the nine Growth Enablers span regulatory rulebooks, primary legislation, and the operational decisions of firms and public institutions. Some can be delivered within months through regulatory action alone. Others depend on the King’s Speech and Mansion House speech as the key policy and legislative decision points this year. Several will extend into 2027 and beyond. Mansion House this year is the critical moment to convert strategic direction into binding commitments – and to establish a clear framework for reporting transparently against delivery milestones, so that firms, investors and consumers can track progress and hold Government and regulators to account. The reform agenda is already producing results. Sustaining that momentum requires accountability as well as ambition. Chapter 1 demonstrates the dependence of the Government’s growth strategies on a strong and agile financial services sector. Chapter 2 sets out a milestone-by-milestone roadmap for delivery. Chapters 3 to 5 examine each of the Growth Enablers in detail – making clear what needs to happen, who needs to act, and what is at stake if the opportunity is not taken. The reform agenda is working, and the task now is to deliver it in full. Financial services sector in numbers Supporting jobs and funding public services 473,000 banking jobs across the UK [ONS] 52% of banking roles located outside London and the South East [ONS] £43.3bn in annual tax contribution by banking sector – ~4.3% of total UK tax receipts [UK Finance] Supporting households and homeownership £1.7 tn in outstanding mortgages supporting UK households [Bank of England] £291 bn in annual gross mortgage lending in 2025 [Bank of England] 8.7 mn households supported to own their home [UK Finance data] 1.9 mn privately rented properties financed [UK Finance data] 391,000 first-time buyer loans in 2025[UK Finance data] Ensuring access and financial inclusion 220+ banking hubs open (with a target of 350+ by the end of the Parliament) ~1 mn transactions each month through banking hubs and deposit services [Cash Access UK] Core banking services accessible through 11,500 Post Office branches, over 40,000 ATMs and over 30,000 shops with PayPoint terminals [Post Office, Link, PayPoint] 7 mn+ fee-free basic bank accounts opened [HMT] Financing UK businesses £68 bn in annual nominal gross bank lending to SMEs (+9% year-on-year) [British Business Bank] £191 bn in nominal stock of bank lending to SMEs (+12% year-on-year) [British Business Bank] The Growth Guarantee Scheme and the Recovery Loan Scheme committed £1.3 bn in total support during 2024/25 [British Business Bank] Payments and innovation 48.8 bn payments made in 2024 in the UK [UK Finance] In 2024, card payments accounted for 64% of all payments in the UK [UK Finance] Almost one in 10 payments made in cash [UK Finance] 75% of financial services firms were already using AI in 2024 - with a further 10% planning to over the following three years [Bank of England] Capital markets and global finance £584 bn raised on average annually through UK capital markets between 2020 and 2024 [UK Finance] £4.9 tn market capitalisation on LSE Main Market – 37% international issuers, from 80+ countries [LSEG] £92.6bn financial services trade surplus in 2024 – making the UK the world’s largest net exporter of financial services [City of London Corporation] £1.6 tn assets managed in UK private banking and wealth management [UK Finance] 4 mn UK clients supported by wealth and advice firms [UK Finance] Tackling fraud and financial crime £870mn of unauthorised fraud prevented by UK Finance members in first half of 2025 [UK Finance] 157 serious organised crime disruptions delivered by industry-funded Dedicated Card and Payment Crime Unit in 2025 [DCPCU] Read the full report Click here Top Built with Shorthand
Plan for Growth: From Strategy to Delivery Nine growth enablers to unlock finance for UK economic renewal Foreword The policy direction is established. The task now – for Government, regulators and industry in partnership – is to act decisively and deliver the financial services reforms that will help build a better society. David Postings – CEO, UK Finance For most people, the test of a strong economy is personal: being able to afford a home, access finance to start or grow a business, manage their money with confidence, and see investment in their communities delivering jobs and opportunity. Financial services reform matters because it impacts these everyday outcomes, from the cost and availability of mortgages and SME lending to the ability of households and communities to withstand economic shocks. It also matters for the UK’s wider growth ambitions. The Government’s priorities – from housing and infrastructure to industrial renewal, regional growth and clean energy – depend on a financial system able to mobilise capital at scale, support risk-taking, and channel investment to where it is most needed. Financial services are not a parallel part of the growth story; they are central to it. This requires a strong and agile financial system, anchored by a resilient core banking sector and infused with the benefits of the UK’s position as a leading international financial centre. Recognising this, the Government has responded ambitiously through its Leeds Reforms, the Financial Services Growth and Competitiveness Strategy, and a wide-ranging programme of reform spanning payments, capital markets, inclusion and housing finance. UK Finance was proud to shape this agenda through our original Plan for Growth. Where reforms have already been implemented, our members have responded enthusiastically: increasing support for first-time buyers following changes to mortgage lending rules last year; and embracing the new Targeted Support framework to improve consumers’ financial decision-making. Now that the reform agenda is established, the focus must turn to implementation. This report, which was developed with extensive input from our members, identifies nine Growth Enablers: the financial services reforms where delivery in 2026 and beyond will do most to support the Government’s wider growth strategies and deliver the greatest impact for people, businesses and the UK economy. For each, we set out what needs to be delivered, by whom and when – and where we think moving faster or going further, within the spirit of the existing agenda, would unlock even greater gains. The sector is ready to play its part. Through Covid, the Ukraine conflict and the cost-of-living pressures since, it has demonstrated what that means in practice: maintaining the flow of lending to households and businesses, supporting customers in financial difficulty through tailored forbearance, and most recently reaffirming its commitment to the Mortgage Charter to help borrowers manage repayments. In a more uncertain global environment than even a year ago, the capacity to back people, businesses and communities when it matters most is precisely what the growth mission needs. Implemented in full, these enablers will help convert national growth ambitions into practical benefits – unlocking investment in new homes and infrastructure, backing SMEs at greater scale, and providing the capital and infrastructure that UK firms need to lead in AI and the industries of the future. Executive Summary Unlocking finance for UK economic renewal Competitive mortgage rates, more businesses backed, new homes built, affordable energy bills and stronger financial resilience for households facing an uncertain world – these are the practical measures by which the Government’s growth agenda will be judged. Delivering them requires a financial system with the capacity, confidence and infrastructure to play its full role. That is the focus of this report. The Government has set a clear and ambitious programme of economic renewal and regional growth through its Modern Industrial Strategy and related strategies on infrastructure and clean energy, housing, SME support, trade, financial inclusion, and national security. Behind every one of them is a clear requirement for specific financial services capabilities. Recognising this, the Government has built an ambitious financial services reform agenda with the Leeds Reforms and Financial Services Growth and Competitiveness Strategy at its heart. UK Finance’s original Plan for Growth helped shape this agenda, and where reforms have been delivered, our members have responded. For example, mortgage reforms announced by the Financial Policy Committee (FPC) last year have helped 391,000 first-time buyers into housing, up from 332,000 in 2024. This is regulatory change working as intended – and only a foretaste of what fuller delivery could achieve. In this report, we identify nine Growth Enablers: mutually reinforcing financial services reforms that will do most to support the Government’s wider growth strategies and deliver the greatest economic impact for people, businesses and communities across the UK. These Growth Enablers do not represent a new direction of travel. Rather, they focus on locking in reforms already committed to by Government and regulators, by turning commitments into durable change; accelerating delivery where pace matters; and in some areas – such as supporting small businesses and tackling fraud – going further to match the ambition the moment demands, with new practical steps that support the Government’s existing objectives. The nine Growth Enablers are organised around three reform objectives, first set out in our original Plan for Growth and as pressing today as when we published it: Delivering a pro-growth operating environment for the financial services sector # Growth enabler Description Strategies Supported Other Growth Enablers reinforced Economic Impact 1 Reducing bank capital requirements Delivery priority Go further The FPC’s decision to revise its Tier 1 capital benchmark is welcome – but it only delivers if translated into reduced capital stacks for individual banks. The Prudential Regulation Authority (PRA) and FPC should now address overlapping capital requirements on domestic lending (which trap capital equating to £250 billion in potential lending capacity) and return the leverage ratio to its intended role as a backstop rather than a binding constraint. The PRA should also commence reviews of the mortgage risk weight framework, internal model approval speeds, and regulatory cliff edges. Housing Infrastructure Industrial SME Plan Trade National Security 7 (SME lending) 8 (financial inclusion) 9 (housing & mortgages) Lower capital requirements would reduce the structural costs of lending – improving mortgage rates and access to credit for households, and strengthening lending flows to SMEs and larger businesses, driving regional growth. 2 Completing reform of redress arrangements Delivery priority Lock in reform & move faster The Government, Financial Conduct Authority (FCA) and Financial Ombudsman Service (FOS) have committed to the most significant package of FOS reforms since its inception. The priority now is implementation, to address the existing uncertainty that feeds into product costs, constrains access to credit, restricts innovation and causes lengthy redress decisions, while harming investment in UK financial services. The FCA should rapidly finalise changes to its dispute resolution (DISP) rules, and Government should confirm primary legislation in the next King’s Speech to place reform on a durable statutory footing. Industrial Housing FinancialInclusion 7 (SME lending) 8 (financial inclusion) 9 (housing & mortgages) A more predictable and efficient redress framework means faster resolution for consumers and greater confidence for firms to invest, innovate and serve a broader range of customers – directly enabling the product and market reforms already in train to deliver their full benefit. 3 Regulatory simplification Delivery priority Lock in reform & move faster The Government’s Regulation Action Plan and decision to merge the Payment Systems Regulator (PSR) into the FCA are welcome steps towards reducing the cumulative regulatory burden that adds costs without proportionate benefit. Primary legislation is needed to lock in the PSR merger, and further reform the Senior Managers and Certification Regime, building on welcome recent steps by the regulators. The FCA should clarify the scope of the Consumer Duty to stop it from extending to wholesale markets, and together with the PRA, it should continue simplifying markets regulation. HM Treasury (HMT) should extend the 25% compliance cost reduction target to cover supervisory and tax administration burdens, and Government should further strengthen UK-EU and UK-US regulatory dialogues. Industrial Trade Infrastructure National Security 4 (payments) 5 (capital markets) 7 (SME lending) Hundreds of millions of pounds per year saved in compliance costs, redirected into growth-driving activities — and stronger international competitiveness and investment flows. Ensuring the financial system is fit for the future # Growth enabler Description Strategies Supported Other Growth Enablers reinforced Economic Impact 4 Supporting payments modernisation and innovation Delivery priority Lock in reform & go further The National Payments Vision set a clear and welcome direction, and the priority now is realising its ambition. This means operationalising the new industry-led Delivery Company (DeliveryCo) to upgrade retail payments infrastructure. It also requires HMT and the regulatory authorities to ensure sufficient regulatory flexibility for the market-led Great British Tokenised Deposits (GBTD) initiative to proceed iteratively, bringing closer the benefits of programmable, tokenised sterling deposits and on-chain settlement to support the UK’s digital finance capabilities. In addition, HMT and the FCA should finalise a new commercially sustainable open banking framework, and the Bank of England (BoE) should progress carefully with the framework for regulated stablecoins. Industrial SME Plan Financial Inclusion Trade Fraud National Security 6 (fraud prevention) 7 (SME productivity) 9 (homebuying reform) Modernised retail payments infrastructure could generate around £9bn a year in economic uplift - with additional benefits over time from delivery of GBTD - supporting SMEs productivity, financial inclusion and fraud reduction. 5 Transforming financial and capital markets Delivery priority Go further The Government’s Wholesale Financial Markets Digital Strategy and the appointment of a Wholesale Digital Markets Champion signal real ambition to position the UK at the forefront of tokenised capital markets – Mansion House is the moment to confirm that ambition, building on the strong progress towards launching a digital gilt. HMT, the Department for Work and Pensions (DWP) and regulators should implement pension schemes legislation to unlock long-term productive UK investment, while avoiding mandates that distort markets. FCA and industry should deliver T+1 settlement, share register digitisation and the consolidated tape on schedule, and merger and investment review processes should be streamlined to encourage international investment. Infrastructure Industrial Trade Housing SME Plan National Security 4 (payments infrastructure) 7 (SME growth) 9 (housing finance) Deeper, more efficient capital markets would help to mobilise the investment that the Government’s infrastructure and clean energy strategies depend on, while positioning the UK as a global hub for tokenisation would help it capture a share of a market projected to reach $3 trillion by 2030. 6 Strengthening technology and telecom firms’ fraud obligations Delivery priority Move faster & go further The Government’s Fraud Strategy sets the right direction – but the obligations on technology and telecom firms remains insufficient given the scale of fraud originating on their platforms. Ofcom should implement proactive fraud prevention obligations through delivery of fraudulent advertising rules under the Online Safety Act. Government should introduce mandatory seller verification and regulated payment options on online marketplaces, and ensure the Online Crime Centre has the accountability and transparency mechanisms to function as a genuine disruption tool. Fraud Financial Inclusion SME Plan National Security 4 (digital payments) 7 (SME e-commerce) 8 (consumer confidence) Stronger upstream obligations on technology and telecom firms could deliver a material reduction in the £450m annual cost of Authorised Push Payment fraud – and build the consumer confidence in digital payments and online commerce on which the digital economy and many SMEs depend. Unlocking financial services for people, businesses and society # Growth enabler Description Strategies Supported Other Growth Enablers reinforced Economic Impact 7 Supercharging government-backed SME support services Delivery priorityGo further The Government’s SME Plan and the British Business Bank’s (BBB) existing infrastructure provide strong foundations, but the scale of government-backed finance support remains three or four times smaller relative to GDP than equivalent schemes in the US, Germany and France. HMT, the Department for Business and Trade (DBT) and the BBB should scale the Growth Guarantee Scheme (GGS) to £5bn of annual lending and establish the Business Growth Service (BGS) as the central SME access-to-finance platform – creating a step-change in the ambition and reach of support for smaller businesses across every region. HMT’s Consumer Credit Act (CCA) review should examine how the regime currently constrains business lending, and the case for removing business lending from its scope. SME Plan Industrial Trade Housing 1 (capital & SME loan costs) 4 (payments & productivity) Scaling the GGS could unlock £4bn+ in additional SME lending each year – generating £10bn+ in new SME turnover annually, with benefits felt most strongly in the regions and communities where the Government's growth mission matters most. 8 Broadening financial inclusion for individuals and households Delivery priority Lock in reform The Government’s Financial Inclusion Strategy sets a serious commitment to ensuring financial services work for everyone, and the priority now is converting its commitments into tangible improvements. The sector is already delivering – over 220 Banking Hubs are now open, building on banks’ existing in-person presence, and UK Finance has launched the Inclusive Design Challenge, which will identify opportunities for collective industry action to remove barriers to inclusion. Key priorities now are completing the rollout of Targeted Support and maintaining momentum on the wider Advice Guidance Boundary Review, modernising the CCA through the upcoming Financial Services Bill to create a clearer and more flexible framework for consumers and firms, and making economic abuse a cross-cutting policy priority. Financial Inclusion SME Plan Industrial 2 (faster redress) 5 (retail investment) 9 (housing access) A more inclusive financial system means more people contributing to and benefiting from growth – strengthening household resilience, supporting labour market participation, and deepening the UK’s capital markets on which sustained growth depends. 9 Mobilising finance to build, retrofit and unlock housing for people Delivery priority Lock in reform & go further Progress is already visible – 391,000 first-time buyers were helped onto the housing ladder in 2025, almost 18% more than the year before, a direct consequence of mortgage rule reform. The FCA’s Mortgage Rule Review should go further, addressing rules calibrated for a different era and supporting borrowers at every stage of life. Government should embed financial services as delivery partners in homebuying and selling reform to address the one-in-three transaction failure rate, and continue collaborating with industry on the Green Home Finance Strategic Partnership to unlock the retrofit finance needed for net zero transition. Housing Infrastructure Industrial 1 (mortgage costs) 2 (product innovation) 7 (housing access) Extending homeownership to tens of thousands more creditworthy buyers annually, cutting the cost and failure rate of home transactions, and unlocking a £10bn per year retrofit opportunity – supporting over 200,000 jobs and reducing household energy bills by £2–3bn per year. Taken together, delivery of these nine enablers could unlock hundreds of billions of pounds of additional economic activity – extending homeownership, backing businesses and channelling capital into every region of the UK. But they are a package, not a menu: the enablers are mutually reinforcing, and the gains from any one of them depend partly on progress across the others. How the Growth Enablers reinforce one another: illustrated through housing and SME support The nine Growth Enablers set out in this report are not a set of independent measures. They are mutually reinforcing, and the gains from any one of them depend partly on progress across the others. Looking at two of the Government’s most prominent policy focuses – housing and homeownership, and supporting small and medium-sized enterprises – shows how this interconnection works in practice and why the enablers are best understood as a combined set. Housing and homeownership The Government’s aims to build more homes, help more people onto the housing ladder, and expand access to affordable accommodation illustrates why joined-up delivery matters. Lower bank capital requirements (Growth Enabler 1) reduce the structural cost of mortgage lending, improving affordability for borrowers.Payments modernisation and tokenisation (Growth Enablers 4 and 5) underpin the digital transaction infrastructure – including UK Finance’s GBTD pilot focused on reducing fraud risk and friction in remortgages.Capital markets transformation (Growth Enabler 5) supports funding for mortgages and financing new housing supply by enabling mortgage lending to be recycled at scale through securitisation, and institutional capital to be channelled into the projects needed to meet the Government’s housebuilding ambitions. Financial inclusion reforms (Growth Enabler 8) including Targeted Support will help more people navigate complex decisions about homeownership and housing wealth across a lifetime.Growth Enabler 9 focuses on aligning mortgage market reform, homebuying and selling reform and retrofit finance with wider housing ambitions. No single enabler delivers the housing mission alone. Each addresses a distinct constraint – on affordability, on transaction infrastructure, on access to advice, and on the supply of new and retrofitted homes – and their combined effect is greater than the sum of their parts. Supporting small and medium-sized enterprises The SME mission follows the same logic. Lower bank capital requirements (Growth Enabler 1) reduce the structural cost of lending to smaller firms, supporting more competitive borrowing costs across the market.Removing regulatory and tax compliance barriers (Growth Enabler 3) reduces the administrative burden on firms serving SMEs, freeing capacity to develop products and reach more customers.Payments modernisation (Growth Enabler 4) directly benefits SME cashflow – faster settlement, reduced transaction costs and improved business liquidity strengthen smaller firms’ ability to manage working capital and grow. For SMEs with online operations, modernised payments infrastructure supports stronger performance in the digital economy, improving customer conversion rates.Strengthening technology and telecoms firms’ fraud obligations (Growth Enabler 6) tackles fraud at source, giving consumers greater confidence to transact online and supporting the growth of e-commerce on which many smaller businesses depend.Capital markets transformation (Growth Enabler 5) bolsters the financing options available to businesses, supporting access to growth capital for businesses as they scale.Supercharging government-backed SME support (Growth Enabler 7) creates a step-change in the reach and ambition of public SME support – improving access to finance by scaling the Growth Guarantee Scheme and establishing the Business Growth Service as a joined-up access point for finance, advice and support. Taken together, these enablers address the full range of constraints that prevent smaller businesses from accessing the finance, infrastructure and support they need to start, grow and scale. The contribution of UK financial services The sector already reaches every part of the economy and every region of the country. It supports over £1.7 trillion in outstanding mortgages, provides almost £200 billion in lending and overdrafts to SMEs – with significant additional funding from asset finance and invoice finance – and processes nearly 49 billion payments each year. Over 220 Banking Hubs are now open across the UK, keeping communities connected to banking services, with the sector on track to deliver 350 hubs by the end of the Parliament. Generating around 9% of UK economic output and contributing over £43 billion in tax annually from banks alone, the sector’s productive capacity underwrites the broader economy. The UK is also the world’s largest net exporter of financial services, with £92 billion in exports annually – a position sustained by its regulatory openness, widely-used common law framework, and deep pools of professional expertise that make it a uniquely attractive international financial centre. But these figures describe what the sector delivers today, under a framework that constrains its productivity, capacity and ability to best serve customers. The reforms set out in this report would allow it to go further: extending credit to more households or at better prices, backing more businesses at scale, channelling finance into infrastructure, clean energy and national security, and strengthening the financial resilience of people across the UK. A sector operating at full strength is also the foundation on which the UK’s ambition to lead in AI-enabled services and the industries of the future depends – providing not just capital, but the payments, data and digital infrastructure that innovative businesses need to start, scale and compete. That potential will be amplified by maintaining the UK’s position as a globally connected financial centre, built for interoperability with the international systems through which capital moves. A clear path to delivery Realising the gains of reform requires not just commitment but sequenced, accountable action. The reforms set out across the nine Growth Enablers span regulatory rulebooks, primary legislation, and the operational decisions of firms and public institutions. Some can be delivered within months through regulatory action alone. Others depend on the King’s Speech and Mansion House speech as the key policy and legislative decision points this year. Several will extend into 2027 and beyond. Mansion House this year is the critical moment to convert strategic direction into binding commitments – and to establish a clear framework for reporting transparently against delivery milestones, so that firms, investors and consumers can track progress and hold Government and regulators to account. The reform agenda is already producing results. Sustaining that momentum requires accountability as well as ambition. Chapter 1 demonstrates the dependence of the Government’s growth strategies on a strong and agile financial services sector. Chapter 2 sets out a milestone-by-milestone roadmap for delivery. Chapters 3 to 5 examine each of the Growth Enablers in detail – making clear what needs to happen, who needs to act, and what is at stake if the opportunity is not taken. The reform agenda is working, and the task now is to deliver it in full. Financial services sector in numbers Supporting jobs and funding public services 473,000 banking jobs across the UK [ONS] 52% of banking roles located outside London and the South East [ONS] £43.3bn in annual tax contribution by banking sector – ~4.3% of total UK tax receipts [UK Finance] Supporting households and homeownership £1.7 tn in outstanding mortgages supporting UK households [Bank of England] £291 bn in annual gross mortgage lending in 2025 [Bank of England] 8.7 mn households supported to own their home [UK Finance data] 1.9 mn privately rented properties financed [UK Finance data] 391,000 first-time buyer loans in 2025[UK Finance data] Ensuring access and financial inclusion 220+ banking hubs open (with a target of 350+ by the end of the Parliament) ~1 mn transactions each month through banking hubs and deposit services [Cash Access UK] Core banking services accessible through 11,500 Post Office branches, over 40,000 ATMs and over 30,000 shops with PayPoint terminals [Post Office, Link, PayPoint] 7 mn+ fee-free basic bank accounts opened [HMT] Financing UK businesses £68 bn in annual nominal gross bank lending to SMEs (+9% year-on-year) [British Business Bank] £191 bn in nominal stock of bank lending to SMEs (+12% year-on-year) [British Business Bank] The Growth Guarantee Scheme and the Recovery Loan Scheme committed £1.3 bn in total support during 2024/25 [British Business Bank] Payments and innovation 48.8 bn payments made in 2024 in the UK [UK Finance] In 2024, card payments accounted for 64% of all payments in the UK [UK Finance] Almost one in 10 payments made in cash [UK Finance] 75% of financial services firms were already using AI in 2024 - with a further 10% planning to over the following three years [Bank of England] Capital markets and global finance £584 bn raised on average annually through UK capital markets between 2020 and 2024 [UK Finance] £4.9 tn market capitalisation on LSE Main Market – 37% international issuers, from 80+ countries [LSEG] £92.6bn financial services trade surplus in 2024 – making the UK the world’s largest net exporter of financial services [City of London Corporation] £1.6 tn assets managed in UK private banking and wealth management [UK Finance] 4 mn UK clients supported by wealth and advice firms [UK Finance] Tackling fraud and financial crime £870mn of unauthorised fraud prevented by UK Finance members in first half of 2025 [UK Finance] 157 serious organised crime disruptions delivered by industry-funded Dedicated Card and Payment Crime Unit in 2025 [DCPCU] Read the full report Click here Top Built with Shorthand
