By Sheree Howard, Executive Director, Financial Conduct Authority

I grew up in a town where the building society branch was a constant presence on the high street. I suspect many of you have that memory too. Over time the sector has evolved alongside economic and social change, but its connection to the communities it serves remains fundamental. 

The Government has set an ambition for mutuals, co-operatives and credit unions to play a greater role in the economy, finding new and innovative ways to serve their members. They want to see a sector that can grow sustainably, be resilient, and continue to serve communities across the UK.  

The FCA and PRA have an important role to play in supporting those ambitions through effective and proportionate regulation. That means regulation which maintains high standards while enabling well-run firms to invest, innovate and grow. 

Our approach has three elements: regulation that reflects the realities of the member-owned business model; targeted support that helps mutuals tackle the specific challenges they face; and regular engagement with societies and the communities they serve. 
 

Showing up in and for our communities 

Building societies contribute to their communities in ways that go beyond the products they offer. Their local presence and member ownership can support investment in the places they serve and help ensure that decisions reflect local needs. 

That instinct shows in new forms today. Societies are turning branches into genuine community hubs, spaces that do far more than process transactions. Some are trialling multi-bank kiosks, so that any customer, regardless of who they bank with, can walk in and access basic services. This shows how the member-owned model can respond to changing community needs.  

Our role is to help create the regulatory conditions in which well run organisations can remain resilient, adapt and continue serving their members for generations to come. 
 

Strengthening resilience and growth  

Earlier this month, the FCA and PRA opened expressions of interest for the second cohort of our Scale-up Unit for dual-regulated firms. This builds on the support we already offer including pre-application support, our Innovation Services and regulatory sandboxes, through which societies can gain vital support. 

Building societies are eligible to apply to the Scale-up Unit and I want to be direct about why that matters. We've already seen firms test genuinely innovative approaches for example, mortgage advice using digital tools. Building societies should have the same opportunity to test new ideas and receive support in navigating regulation.  

We know mutuals grow differently to other financial sectors and are shaped by the interests of their members. That's exactly why we've revised the eligibility criteria to recognise the structure and scale of the building society sector.

Expressions of interest are open until 30 September for banks, building societies and other dual-regulated firms. Participating building societies would be expected to have assets above £1 billion, reflecting the shape of the mutual sector. For other dual-regulated firms, the existing eligibility range is £3 billion to £20 billion in assets. This distinction is designed to ensure the unit is accessible to building societies of relevant scale. 
 

Consider our support services 

None of this works without you. 

We value our engagement with the Building Societies Association and its members. Our regular presence at BSA events gives us the opportunity to hear directly about the issues affecting you and helps shape how we regulate. 

So, if your society is looking to grow, innovate or better understand the regulatory landscape, speak to us. Consider the range of support services available to help you along the journey to growth.