The FX industry in the UK is facing a new wave of regulatory changes that could reshape how firms operate. From revised FCA guidelines on operational resilience to early impacts of PSD3 across Europe, these updates require more than just legal reviews — they demand practical adjustments to how compliance and infrastructure are built into the day-to-day operations of FX firms.
For businesses already juggling licensing obligations, cross-border payments, and rising client expectations, these developments might feel like another layer of friction. But with the right approach, they can also become an opportunity to future-proof your compliance strategy and reduce long-term operational risks.
FCA’s Tougher Stance on Operational Resilience
In July 2025, the FCA began enforcing updated rules for Electronic Money Institutions (EMIs) and Payment Institutions (PIs), with a strong emphasis on operational resilience. This includes:
- Mapping and documenting all critical business services
- Stress-testing systems to identify potential points of failure
- Developing comprehensive exit strategies for third-party vendors
- Enhancing the safeguarding of client funds, including how funds are segregated and reported
For FX firms that rely heavily on third-party tech platforms or payment rails, these changes require a full review of how systems are architected and where dependencies lie. It’s no longer enough to have robust operations. The regulator now expects firms to prove that they can recover quickly and continue to serve clients even during major disruptions.
What to do now:
- Conduct a resilience audit of all core services, including FX execution, onboarding, payments, and reconciliation
- Review vendor SLAs and ensure that exit clauses and backups are documented
- Ensure safeguarding processes are not only in place but are independently tested and traceable
Preparing for PSD3: EU Rules, UK Relevance
Although the UK formally left the EU, many UK-based FX businesses still operate in the European market through subsidiaries or partnerships. PSD3, now finalised and rolling out in 2026, is already influencing the market, especially for firms that act as AISPs (Account Information Service Providers) or PISPs (Payment Initiation Service Providers).
Here are the key points of PSD3 likely to affect FX providers:
- Tighter requirements on customer authentication
- Real-time fraud monitoring obligations for PSPs
- Higher expectations for API transparency and performance for open banking services
- Improved customer rights around data sharing and payment authorisation
Even if you don’t operate in the EU directly, clients and partners increasingly expect PSD3-aligned features — especially those handling multi-jurisdictional flows.
What to do now:
- Audit your current API performance and availability metrics
- Ensure all authentication processes align with the highest security standards
- Start building in real-time transaction monitoring if not already in place
- If you operate across borders, engage with legal advisors to map out licensing and compliance overlaps
AI in Compliance: New FCA Expectations
The FCA recently issued guidance around the use of AI in financial services, particularly in areas like KYC/AML screening and transaction monitoring. The key message is clear: if your systems use AI to make compliance decisions, you must be able to explain how those decisions are made.
This presents a challenge for firms using third-party tools that rely on black-box models. It also raises questions around data governance, audit trails, and human oversight.
What to do now:
- Review your existing AI tools used for compliance and ensure they offer auditability
- Create internal documentation that explains how decisions are made — especially when screening customers or flagging transactions
- Train compliance staff on interpreting and challenging AI-driven outputs
- Ensure data used in AI models meets FCA standards on fairness and explainability
Moving from Compliance to Competitive Advantage
Compliance has often been treated as a cost centre in FX businesses. But this mindset is shifting. When done right, a strong compliance foundation becomes a differentiator — helping firms move faster, build trust with partners, and enter new markets with confidence.
These 2025 regulatory updates are not just checklists. They’re catalysts. FX firms that adapt early will find themselves in a stronger position to:
- Secure better partnerships with banks and PSPs
- Win corporate clients looking for stability and transparency
- Launch new services faster in compliant ways
- Avoid fines, audits, or reputational damage down the road
Start Small, Act Decisively
The pace of regulatory change can feel overwhelming. But not every firm needs to overhaul its systems overnight. A phased approach works best.
Begin by focusing on the core areas touched by the FCA and PSD3 changes:
- Resilience and safeguarding
- Transaction monitoring and authentication
- Transparent and auditable tech tools
Prioritise actions that reduce operational risk while improving transparency. Keep your internal team aligned and educate them on what these changes mean in day-to-day terms.
When you’re ready, bring in specialist advisors to validate your approach or recommend process improvements.
