Roseanne Spagnuolo, Vixio’s Chief Research & Data Officer, is a global B2B information services leader driving Vixio’s research strategy
I believe this year will be remembered as the year we upended regulation, for governments are taking a microscope, and sometimes a heavy hand, to examine regulations, the bodies that oversee those regulations and their impact on markets, competition and innovation.
While it might initially be a bit unsettling, I think it’s well overdue; the creation of regulatory agencies is typically a reaction to an adverse market event.
For example, in 2002, the Sarbanes-Oxley Act was passed in response to accounting scandals that rocked investor confidence, which created the PCAOB. The Frank-Dodds Act was passed and the CFPB was created in response to the 2008 global financial crisis. In March of 2013, after nearly a decade of reviews, the PSR was created under the Financial Services Act to oversee the payments industry in the U.K.
Revisiting Regulations: Ensuring Policy Alignment With Market Realities
But like any strategy or policy, it’s imperative to frequently revisit these regulations to ensure the purpose is still relevant, being achieved and reflecting the current market realities. Regulators and governments are as effective as the system they govern, and when there’s a disconnect between policy and markets, efficacy declines, resulting in public distrust.
Through this potential regulatory overhaul, the challenge will be to stay on top of the signals coming from governments via speeches, social media and consultations.
I believe firms can come out on the other side stronger and more competitive if they invest in an understanding of the upcoming regulatory landscape—recognizing how it’s changing, connecting the dots and staying a few steps ahead.
What Financial Institutions Are Prioritizing
To help understand the regulatory landscape, in 2024, my company surveyed 127 financial institutions worldwide as a part of our “2025 Payments Compliance Outlook” report to understand their priorities for the upcoming year. These priorities included:
• Fraud Prevention And Detection: As bad actors increasingly use AI in sophisticated social engineering schemes, a technological arms race has emerged, resulting in billions in losses and a devastating emotional toll on victims.
• Data Protection And Privacy: Despite the EU’s General Data Protection Regulation (GDPR) being in effect since 2018, many organizations still struggle with its requirements. High-profile fines (such as over $300,000 for Ibercaja Banco or a little over $1 million for mBank in 2024), serve as stark reminders of the risks of noncompliance.
• Cybersecurity: Financial institutions rely on complex, interconnected systems, so any information and communication technology failure could disrupt critical operations, affecting customers and revenues.
Emerging Trends And Regulatory Shifts
While these are still critical issues for 2025, now that we are well into the year, I’m paying particular attention to the following:
1. The current aggressive efforts in the U.S. to reduce the size of the federal government, specifically the attempts to dismantle the Consumer Financial Protection Bureau (CFPB).
2. Regulators expanding fraud accountability beyond financial institutions to telecoms and social media platforms.
3. The recent move in the U.K. to consolidate the Payment Systems Regulator (PSR) for efficiency.
In my last article, I covered the regulatory fatigue that firms are feeling and how many leaders have been calling for a pause. I see politicians listening; governments are moving to reduce the regulatory burden, throwing out red tape in favor of growth, and simplifying the complex web of regulations and governing bodies.
When it comes to the limiting of the Consumer Financial Protection Bureau in the U.S., Senate Democrats have urged reconsideration, warning that weakening the Consumer Financial Protection Bureau could reduce consumer protection and regulatory oversight in financial services. If the CFPB were to be significantly weakened, the industry could see a shift away from consumer protection enforcement and regulatory oversight.
In reality, I think it creates a gap for state regulators to step up and define a regulatory landscape that supports local economies and businesses. To what extent states will fill the gap is unknown; are they willing to flex their regulatory muscle in new areas? Keynesian economists would argue that the market should figure it out.
Global Regulatory Shifts
Everything seems to be in scope for review, and several pending regulations could be at risk. Key proposals that may be rolled back or stalled include the Open Banking Rule, rules governing digital wallets and buy now, pay later (BNPL) oversight.
It doesn’t stop there; in the name of consumer protection, regulators are pushing to expand accountability beyond financial institutions to reflect the realities of the market. Examples of this include:
• Singapore’s Online Criminal Harms Act (OCHA), where there is a shared liability framework with telecom companies.
• The U.K.’s Payment Systems Regulator (PSR) introduced reimbursement rules for authorized push payment (APP) fraud and split responsibility equally between the institution that sent the scammed funds and the institution that received them.
• The EU’s new Verification of Payee (VoP) protocols, which come into effect in October 2025, and require EU institutions to have interoperable VoP solutions that are easy for their customers to understand.
Currently, though, tech firms are lobbying the Trump administration and challenging international regulations, such as the EU’s Digital Markets Act (DMA) and Digital Services Act (DSA) and the U.K.’s Online Safety Act.
But already facing pressure, with tension increasing between the U.S. and Europe around tariffs and defense spending, I think it seems unlikely that the EU or U.K. would want to rock the boat by introducing a liability regime.
Conclusion
I believe this era will be remembered not just for regulatory disruptions but as a time when governments took bold actions to overhaul the framework of financial oversight. Going forward, the challenge for regulators and industry alike will be to balance efficiency with safeguarding trust as the foundation of the financial system.
Potential cuts or restructuring to regulations like the CFPB and the PSR signal a shift towards streamlining and a deepening tension between innovation, market regulation and consumer protection.
It’s uncertain if markets will thrive under this stripped-back approach or face a regulatory void. Regardless, firms that invest in understanding the regulatory landscape can be better positioned to come out ahead.
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