Introduction
We know that many firms have welcomed the support of the New Banks Start-up Unit in helping them to become authorised in the UK. But we have also heard that, as banks and building societies grow, some may need additional support. For example, firms tell us that they can sometimes struggle with the complexity of regulations when launching new products and that there is a strong desire to have greater certainty around their capital requirements to support discussions with potential investors.
The Scale-up Unit was created to address this by providing a dedicated point of contact to tackle these challenges. On this page you can find information about new initiatives the Scale-up Unit is undertaking for growing banks and building societies, as well as other relevant existing PRA and FCA initiatives. You can also find out more about the work of the Scale-Up Unit for Insurers and FCA solo-regulated firms in the ‘Related Links’ section.
What will the Scale-up Unit do for Banks and Building Societies?
The Scale-up Unit will provide a dedicated point of contact to help banks and building societies that are looking to scale up by providing support on topics including:
Capital reviews: the Scale-up Unit will work to facilitate out-of-cycle capital reviews for firms that are rapidly growing, or whose business models have changed significantly;
Regulatory processes: the Scale-up Unit will help firms to understand which regulatory processes would be relevant to their scaling-up plans and to co-ordinate regulator interactions ahead of, and during the process of, formal submission, for example on variation of permission (VoP) applications;
Product innovations: for firms looking to launch a new or innovative product or service, the Scale-up Unit will support an early-stage discussion on these plans and the corresponding regulatory treatment; and
The impact of new policy proposals on Scale-up firms: if there are aspects of new policy which are relevant to, or could impact, scaling-up firms, the Unit will provide a means to facilitate information-sharing for the purposes of the PRA and FCA’s policy-making processes; and
Sector engagement: The Scale-up Unit will support ongoing dialogue between regulators, firms and the wider scale-up eco-system.
We’re also interested in hearing your views on where the Unit could be doing more to explore opportunities for greater proportionality and efficiencies. You’ll find details on how to engage with us below.
How is this different to engagement with our existing supervision teams?
The core principles of the PRA and FCA’s supervisory approaches will remain the same (you can find out more about this in ‘Related Links’). The Scale-up Unit will work in tandem with existing supervision teams and regulatory processes where they touch on specific aspects of your plans to scale up. The Scale-up Unit will not provide general regulatory information or cover topics outside of this, and it is not intended to be a substitute for discussions you would typically have with existing supervision team contacts. The Unit will not lower regulatory standards, or guarantee a successful decision, and engagement is not an endorsement of your products or services.
Which Banks and Building Societies are eligible to access the Scale-up Unit?
The Unit is specifically designed to support firms that are already scaling up within their chosen markets.
As such, banks and building societies which broadly align with the following criteria can access this service:
- You are in scope of PRA/FCA dual regulation – this aspect of the Scale-up Unit is only for firms that are already authorised by both regulators;
- You have been operating for more than five years, so are not part of the New Banks supervisory approach;
- You are in a period of sustained growth e.g. income growth of at least 20% over a three year period, and are looking to continue this upward growth trajectory; and
- You have a genuine need for support from the regulators to scale up and are not already of the size and scale where accessing these resources via other channels would be feasible. When considering requests for support, the Unit will be mindful of (i) the size and complexity of the firm’s activities; and (ii) the extent of its available financial and non-financial resources or its ability to access support from third parties. As such, we expect the service to be of particular interest to firms with a balance sheet in the range of £3bn to £20bn.
The Scale-up Unit will initially be launched in the banks and building societies sector on a limited basis with a small cohort of firms, who we will engage with to further develop the work of the Unit. In this phase, the FCA will seek to provide a dedicated supervisor for firms in the cohort. If you meet the above criteria and are interested in joining this initial cohort, please email us at the address below by 30 November 2025, setting out how you meet the criteria outlined. Engagement with the first cohort of Scale-up banks and building societies will commence from December 2025.
Existing initiatives to support firms looking to scale up
Listed below are some of the steps we have already taken to advance the secondary competitiveness and growth objective (SCGO), which are relevant to financial services firms looking to scale their businesses in the UK. Together with the work of the Scale-up Unit, we believe that these, and future initiatives, will deliver significant simplifications and efficiencies for banks operating in the UK, while maintaining resilience – a necessary foundation for sustainable economic growth.
You can find out more about these initiatives by following the links below:
Strong and Simple: the regime delivers a more proportionate and tailored approach to prudential regulation for non-internationally active Small Domestic Deposit Takers (SDDTs), while maintaining the resilience of these firms. The regime has delivered a material reduction in liquidity and disclosure requirements and we have now proposed material simplifications across all aspects of our capital framework.
Authorisations timelines: the PRA and FCA have announced that we will be reducing timelines and streamlining processes for authorisations in a number of areas including new, non-statutory targets that go beyond the Government’s proposed new deadlines in legislation where possible. These changes will promote substantially quicker determinations of applications for firms in the UK.
Senior Managers and Certification Regime (SMCR): the PRA and FCA announced the first phase of reforms to the regime to streamline processes and increase their efficacy. This complements recent improvements to the PRA’s internal processes for determining the fitness and propriety of Senior Managers.
Future Banking Data: we are reviewing our approach to regulatory reporting as part of the Future Banking Data (FBD) programme. The FBD programme aims to deliver tangible cost reductions in banking regulatory reporting, as well as improvements to the relevance, quality and timeliness of data collection.
MREL: The Bank’s final policy in relation to setting MREL, which has been updated in response to firm and industry feedback following the consultation published in October 2024, included raising the total assets indicative thresholds for a transfer or bail-in preferred resolution strategy from £15-25 billion to £25-£40 billion.
Internal Ratings Based (IRB) approach: We are committed to speeding up the time for review and response to firms’ IRB model applications. We are also exploring a “foundation IRB approach” which would allow firms to use PRA-prescribed values for loss-given default instead of estimating their own for the purposes of modelling their capital requirements. This would significantly reduce the amount of modelling, time and resourcing required to obtain IRB permissions.
This is not an exhaustive list of the work we are doing in this area – you can out find out more about the work of the PRA including our open consultations and discussion papers in ‘Related Links’.
Contact us
You can get in contact with us at the following address: BankScaleupUnit@bankofengland.co.uk