Core Viewpoint - The Financial Conduct Authority (FCA) is planning to relax its controversial consumer duty reforms introduced in 2023, following pressure from Rachel Reeves to reduce regulatory burdens on businesses [1][2][6]. Group 1: Regulatory Changes - The FCA's proposed changes aim to alleviate the complexity and costs associated with the new consumer rules, which have been burdensome for many firms in the financial sector [2][6]. - The relaxation of consumer duty rules will particularly affect banks and stockbrokers dealing with professional traders, as well as firms serving wealthy clients and international customers [4][5]. Group 2: Economic Impact - The FCA's decision is aligned with the Chancellor's push to stimulate the UK economy by encouraging risk-taking and enhancing competitiveness within the financial industry [6][8]. - The consumer duty was initially introduced to set higher standards for consumer protection, including preventing excessive fees and improving customer flexibility [7][8]. Group 3: Compliance Costs - Some banks have reported that the consumer duty has resulted in increased compliance costs, particularly for large stockbrokers who must prove their operations do not negatively impact customers [7]. - The FCA plans to drop the requirement for firms to have a "consumer duty champion" on their boards, further reducing compliance burdens [6].