Top 5 – What's In Store For Financial Services In 2026?

Our global FSR team flags the major developments across key regions

We asked our global FSR team to look ahead at what 2026 has in store, and to undertake the tricky task of identifying a 'Top 5' for several key jurisdictions. These Top 5s represent what our team feels will be the developments with the most activity and impact in 2026 either across the financial services sector in each jurisdiction or in particular lines of business.

EU regional developments

1. CRR3/CRD6 (Basel 3 finalisation)

Summary

The banking package revises Pillar 1 across credit, CVA and operational risk, introduces the output floor, and updates market risk capital under FRTB. CRD6 strengthens supervision, embeds ESG risk, and creates an EU wide regime for third country branches. Banks must re model RWAs, update Pillar 3, and redesign booking, governance and reporting.

Indicative timeframe

CRR3 largely applies from 1 January 2025; market risk / FRTB applies from 1 January 2026. CRD6 must be transposed by 10 January 2026 and applied from 11 January 2026. The third country branch framework, including Article 21c 'core banking services', applies from 11 January 2027, with certain reporting obligations from 11 January 2026.

2. EU AML package (AMLR, AMLD6, AMLA)

Summary

A directly applicable AML Regulation creates a single rulebook, broadens obliged entities, sets a €10,000 cash cap, and harmonises CDD, PEPs, and reporting.
AML Authority (AMLA) begins operations to coordinate supervision and FIUs. Member States implement AMLD6 for institutions and registers. Obliged entities must uplift frameworks comprehensively.

Indicative timeframe

AMLA operational from 1 July 2025.

AMLR applies from 10 July 2027 (with limited later dates for specific sectors). AMLD6 transposition due by 10 July 2027, with some elements earlier (2025-2026) and others later (2029).

3. PSD3 / PSR (EU payments package)

Summary

The package modernises PSD2. PSR will directly harmonise conduct rules; PSD3 updates licensing and supervision.

Key obligations include verification of payee for non euro credit transfers, stronger fraud refunds, API performance standards, prohibition of obstacles, and consumer 'permission dashboards'. PIs and EMIs gain fairer access to accounts and systems.

Indicative timeframe

Final political agreement occurred in late 2025; formal adoption mid‑2026.

Application expected 18–24 months after entry into force, pointing to core obligations in H2 2027 (some possibly later).

4. FIDA (Financial Data Access; Open Finance)

Summary

FIDA establishes regulated schemes for access to financial data across banking, investments, insurance, pensions, and beyond, on customer request and under GDPR compatible permissions. It will catalyse new distribution, embedded finance, risk analytics, and switching, while imposing governance, liability, and security obligations on data holders and users.

Indicative timeframe

Final political agreement is awaited. Phased application culminating by 2027.

Firms should plan for scheme participation, permission management, security controls, and product redesign by 2027.

5. AI Act — High risk finance use cases

Summary

The AI Act imposes obligations on providers and users of 'high risk' AI, which include creditworthiness assessment and other finance critical models. Requirements span risk management, data governance, technical documentation, record keeping, transparency, human oversight, and post market monitoring. Governance, model inventories, testing, and audit readiness are essential.

Indicative timeframe

Prohibitions and general provisions apply from 2025; core high risk obligations phase in through 2026–2027. By 2026/2027, high risk finance use cases must meet conformity and governance duties; GPAI codes and standards also mature over 2025–2026.

Notes: Timelines reflect the legal application dates and widely reported implementation windows; some Level 2 measures and supervisory expectations will continue to evolve across 2026–2027.

Spain developments

1. MiCA implementation and Spanish crypto assets regime

Summary

Spain's MiCA regime becomes fully operational for CASPs after the end of a transitional period. Existing providers must hold MiCA authorisation and meet conduct, prudential, governance, white paper, market abuse and safeguarding duties. CNMV leads on CASPs; Banco de España and the Treasury interface on e money tokens and AML/CTF.

Indicative timing/status

Spain's transitional period for existing providers ends 30 December 2025. From 2026, CASPs must be authorised under MiCA to operate. Supervisory reporting and Level 2 standards continue to roll out through 2026/2027, with supervisory expectations tightening as the regime beds in.

2. Spanish Customer Service Law (Servicios de Atención a la Clientela)

Summary

Horizontal law setting minimum customer service standards across sectors, including financial services. It mandates maximum response times, access to human agents, clearer complaint pathways, service level reporting, and oversight of outsourced providers. Banks, insurers and investment firms must redesign contact centre operations, MI, governance and vendor management to meet the new baseline.

Indicative timing/status

Approved by Congress; pending Senate vote. Entry into force will follow publication, with phased application expected.

Financial sector compliance build will run through 2026/2027 and should be coordinated with the new Financial Customer Protection Authority to avoid duplicative standards and processes.

3. CCD2 — Second Consumer Credit Directive

Summary

CCD2 expands scope to small loans and BNPL, modernises disclosures, tightens advertising, and strengthens creditworthiness assessment and withdrawal rights. Spanish lenders, BNPL providers, and intermediaries must re paper product terms, journeys, and controls; systems must support concise SECCI, affordability checks, and post contractual rights.

Indicative timing/status

Member State measures must be applied from 20 November 2026. Spain must adopt and apply national measures consistent with this date; legacy agreements remain under old rules until expiry.

4. AIFMD II/UCITS amendments in Spain

Summary

Spain must implement AIFMD II amendments, including rules for loan originating AIFs, LMTs, delegation oversight, depositary regimes, and enhanced reporting. Spanish AIFMs and UCITS managers must update internal policies, risk, liquidity, and loan origination controls, and prepare for revised supervisory reporting templates and data.

Indicative timing/status

National measures must apply from 16 April 2026. ESMA standards and reporting template changes land through 2026–2027, requiring staged operational updates.

5. EU AML package — Application in Spain

Summary

The AML single rulebook applies directly from July 2027, resetting customer due diligence, cash limits, PEP scope, beneficial ownership transparency, and reporting. Spain must also implement AMLD6 for institutional arrangements, registers, and supervisory coordination. Obliged entities must complete comprehensive framework uplifts and upgrade controls.

Indicative timing/status

AMLA operational from 2025. AMLR applies from 10 July 2027; Spain must transpose AMLD6 by 10 July 2027 (with some elements earlier / later). Supervisory and FIU processes will align accordingly.

Hong Kong developments

1. New regulatory regimes for virtual asset (VA) dealing, advisory, management and custodian services

Summary

The Government and the SFC consulted on proposed licensing regimes for providers of VA dealing and custodian services in 2025. They published consultation conclusions and launched a further consultation on proposed licensing regimes for providers of VA advisory and management services in December 2025.

Indicative timeframe

The Government and the SFC aim to introduce a Bill into the Legislative Council in 2026 for all four licensing regimes. We expect the SFC to consult on and publish accompanying supervisory guidelines for the implementation of the new regimes.

2. Legislative framework to enhance protection of computer systems of critical infrastructure

Summary

The Protection of Critical infrastructures (Computer systems) Ordinance is aimed at strengthening the security of the computer systems of critical infrastructures and minimising the chance of essential services being disrupted or compromised due to cyberattacks.

The Ordinance applies to sectors that deliver essential services, including the financial services sector. Designated operators are required to fulfil organisational, preventive, and incident reporting and response obligations.

Indicative timeframe

The Ordinance commenced operation on 1 January 2026 with the establishment of the Office of the Commissioner of Critical Infrastructure (Computer-system Security).

The operators and critical computer systems that are designated over the coming months will be required to comply with the Ordinance.

3. Responsibility sharing framework for authorised payment scams

Summary

The HKMA commenced a consultation with retail banks in September 2025 on a proposed framework for responsibility sharing in relation to losses arising from authorised payment scams.

Indicative timeframe

The timeframe has yet to be announced and the consultation documents have not been made publicly available.

4. Enhancements to banking legislation

Summary

Enhancements to the Banking Ordinance have been proposed following a review, including (among others):

• Simplification of the three-tier banking system into two tiers;
• Enabling the HKMA to exercise direct regulatory/supervisory powers over locally incorporated bank holding companies;
• Allowing the HKMA to engage skilled persons; and
• Extending the HKMA's enforcement powers.

Indicative timeframe

The proposals are at different stages of consultation and consideration. A timeframe has yet to be announced.

5. Accelerated settlement for the cash equities market

Summary

The Hong Kong Exchanges and Clearing Limited (HKEX) launched a discussion in July 2025 on the potential benefits and challenges of shortening the current T+2 settlement cycle for secondary transactions in the cash equities market. The HKMA issued a circular in August 2025 encouraging banks to engage in early preparations, including allocating sufficient resources for the transition to an accelerated settlement cycle.

Indicative timeframe

The HKEX is considering the feedback on its discussion paper, and has stated that a transition to a shorter settlement cycle will be a 'multi-year journey'.

When deciding the timeframe for a transition, the HKEX will consider the timing of existing initiatives in the Hong Kong market and the progress of transition in overseas markets.

Singapore developments

1. Crypto / Stablecoin regulations

Summary

There will be a new regulated activity of 'stablecoin issuance service' under the Payment Services Act 2019 and a new definition of 'stablecoin'. The Monetary Authority of Singapore (MAS) has finalised the features of its stablecoin regulatory regime and is preparing draft legislation.

Indicative timeframe

TBA

2. Artificial Intelligence Risk Management

Summary

MAS is currently consulting on proposed Guidelines on AI Risk Management. It is expected that the finalised guidelines will be accompanied by an AI Risk Management Executive Handbook.

Indicative timeframe

Comments on the consultation paper are due by 31 January 2026

3. Private markets

Summary

MAS will introduce a new regulatory framework for retail investors to invest in private market investment funds, providing the retail public with a wider set of investment choices.

Indicative timeframe

TBA

4. Measures to enhance investor recourse avenues in market misconduct cases

Summary

MAS has proposed to enhance investors' ability to seek civil compensation for losses suffered from market misconduct by facilitating self-organisation, providing access to funding and reducing legal barriers to civil action.

Indicative timeframe

MAS' response to the feedback to its consultation paper is expected in 2026

5. Changes to product classification rules

Summary

MAS has proposed reforms to the product classification regime, such as enhanced disclosures and simplified nomenclatures for complex products, streamlined distribution safeguards for complex products and extra protection for certain clients.

Indicative timeframe

MAS aims to finalise the proposals in 2026

Australia developments

1. Payment and Digital Asset Reform

Summary

Australia will pass new legislation as part of a first tranche of measures to reform the regulation of payment activities. This will impact all entities (whether currently regulated or not) providing payment services in and into Australia.

Also, new legislation to regulate digital asset platforms providers and digital assets custodians will impact all entities (whether currently regulated or not) involved in custody, operating token platforms or intermediating digital assets.

Indicative timeframe

For the Payment Reforms, first tranche of legislation in 2026 with implementation likely in 2027 and a transitional period likely until 2028. A second tranche of legislation anticipated in 2026/2027.

For Digital Asset Reforms, legislation is already before the House with implementation likely in 2026 and a transitional period until 2027/2028.

2. Financial Crime Reform

Summary

This is expected to be the most significant change impacting Australian entities in 2026.

Indicative timeframe

Reforms come into effect on 31 March 2026 for existing reporting entities (banks, insurers, asset managers, etc) and 1 July 2026 for those additional entities that FATF requires are subject to financial crime requirements (e.g. law firms, real estate agents, precious metal dealers, etc.)

3. Financial advice reform

Summary

The 'Delivering Better Financial Outcomes' (DBFO) legislative package is a set of advice reforms focused on improving access to quality and affordable financial advice. The DBFO package is highly anticipated by industry as the key measure that will establish a simpler and more viable financial advice regime, with a view to addressing the 'advice gap' in Australia.

Indicative timeframe

Tranche #1 was legislated in September 2024.

Tranche #2 was partially introduced for consultation in March 2025. More substantial reforms as part of Tranche #2 are expected in 2026. There is considerable industry lobbying taking place to seek to expedite this timing.

4. Scams

Summary

With a framework already in legislation, a draft package containing more detailed measures has just been published and will be implemented in 2026. Banks, telcos and social media platforms are all in scope of the first wave of sectors subject to the requirements. Mandatory codes are being established for each sector together with an overarching framework for an external dispute resolution body.

Indicative timeframe

The Framework has already been law since 2024.

In 2026, we will see the delegated legislation (including the SPF Rules) and mandatory sector Codes put in place. It is expected that there will be short implementation period.

5. Private markets

Summary

ASIC has set out its roadmap to increase the attractiveness of public markets and lift conduct in private markets. ASIC proposes to modernise public markets including a new listing framework (a streamlined IPO process) and robust trading platforms. In private markets, ASIC seeks better tools from the government for effective supervision including a notification regime, data collection and independent audit requirements.

Indicative timeframe

There are a variety of key milestones over the next 12 – 18 months.

UK developments

1. Basel 3

Summary

The UK has set a revised implementation date for the introduction of the final stage of Basel 3 reforms.

Indicative timeframe

1 Jan 2027: Main implementation date
1 Jan 2028: UK implementation of FRTB-IMA
1 Jan 2030: End of UK transitional period, Basel 3.1 fully phased in

2. FCA's expanding remit

Summary

The FCA is once again in a period where its remit is expanding:

• The FCA is due to formally subsume the Payment Systems Regulator (PSR).
• The Government has announced that responsibility for AML/CTF supervision of legal, accountancy, and trust and company service providers will be consolidated under the FCA.
• The regulator is due to play a more central role in mass redress events once reforms to that regime are finalised.
• It will, in the course of 2026, introduce a comprehensive regime for cryptoassets.

Indicative timeframe

The timeline for formal PSR integration into the FCA, for the FCA to assume its new AML supervisory responsibilities and for reform of redress is to be confirmed, with the Government indicating it will legislate as soon as Parliamentary time allows. We expect that legislation in 2026.

The FCA has indicated 2026 for its crypto regime to go live.

3. 'Leeds Reforms'

Summary

The UK Chancellor has initiated a wide-ranging package of regulatory reforms with the aim of improving international competitiveness and economic growth. Among these are reforms to the UK SMCR, changes to how mass redress events are managed, and more.

Indicative timeframe

There are a range of dates, so the development is open-ended. As legislation is required to enact some of the planned changes, we expect there will be a Financial Services (and Markets?) Bill in 2026.

4. Transition to T+1

Summary

The UK is progressing towards switching to T+1 equities settlement in October 2027.
Recognising that the operational practicalities of fund settlement will not allow all authorised fund managers to offer T+1, the FCA expects that for UK-authorised funds and recognised schemes investing predominantly in markets operating on T+1, moving trades in fund units to T+2 settlement would be in investors' interests.

Indicative timeframe

October 2027

5. Private markets

Summary

Following on from primary market reforms, the UK FCA is introducing a new type of private stock market – PISCES – to make it easier and quicker to trade shares in private companies.

Indicative timeframe

2026

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.