Friday 2nd October 2026 – A stronger focus on evidence, proportionality and the cumulative impact of regulation should be at the heart of how future financial regulation in Ireland is developed and assessed, according to a submission by Banking & Payments Federation Ireland (BPFI) to the Central Bank of Ireland’s consultation on Regulatory Impact Assessments.
The consultation, which forms part of the Central Bank’s work to develop a more effective and efficient regulatory framework, proposes a new approach to how evidence, costs and impacts are assessed when developing regulation and how stakeholders are consulted as part of that process.
Commenting on the submission, Brian Hayes, Chief Executive of BPFI, said: “We welcome the Central Bank’s proposed Regulatory Impact Assessment framework and expanded consultation principles as an important step towards better regulation. The consultation was highlighted by the CBI as a core action in its roadmap, published in December last year, for a more effective and efficient framework. We have consistently made the point that all public authorities in Ireland have a responsibility to deliver on the Government’s commitment to improve the regulatory environment. The CBI’s consultation in this critical area of regulatory impact sends out an important message to all stakeholders and is most welcome.”
“Good regulation starts with being clear about the problem we are trying to solve. Before introducing a new requirement, there should be clear evidence that intervention is necessary, that existing rules are not already addressing the issue and that the proposed response is proportionate to the problem identified.”
“The proposed impact assessment framework is an important opportunity to embed that discipline more firmly into regulatory decision-making. In particular, the recognition that ‘no action’ can be a legitimate outcome is significant. The existence of a risk should not automatically mean another layer of regulation if that risk is already being appropriately managed.”
Mr Hayes added: “This is not an argument for less regulation. It is about better regulation. A regulatory framework should achieve its objectives as simply and effectively as possible, while taking account of the cumulative impact of existing and forthcoming requirements. Complexity and duplication carry real costs and can make regulation harder to implement and supervise consistently.”
“That same discipline should apply throughout the regulatory lifecycle. Regulation should not be viewed as a one-way process in which requirements are introduced and simply remain in place. There needs to be a continuous process of reviewing what is working, what is no longer necessary and where rules can be simplified or consolidated. A strong impact assessment framework can help ensure that regulation remains evidence-based and effective.”
Building on these priorities, BPFI’s submission makes a number of wider recommendations aimed at strengthening regulatory decision-making from the initial case for intervention through to implementation and review. These include:
- Establish a clear evidence base for intervention, demonstrating why regulatory action is necessary and why existing requirements are insufficient, with the strength of the evidence proportionate to the scale and impact of the proposed intervention.
- Embed proportionality and simplicity, including choosing the simplest effective intervention and considering the cumulative impact of existing and forthcoming regulation.
- Provide greater clarity on regulatory and supervisory instruments, distinguishing binding requirements from guidance, Q&As and other non-binding measures, and ensuring non-binding guidance does not become binding through supervisory practice.
- Engage stakeholders earlier, allowing industry evidence and practical experience to inform problem definition, policy options and impact assessment, with greater transparency on how feedback influences final decisions.
- Strengthen accountability and review, including appropriate scrutiny of material RIAs and defined post-implementation reviews to assess whether regulation remains necessary, proportionate and effective.
BPFI’s response to CP170 Regulatory Impact Assessments, and the Central Bank’s Approach to Consultation can be downloaded here.
ENDS/
Note: Banking & Payments Federation Ireland (BPFI) represents the banking, payments and fintech sector in Ireland. Together with its affiliates, the Federation of International Banks in Ireland, and the Fintech & Payments Association of Ireland, BPFI has over 120 member institutions and associates, including licensed domestic and foreign banks and institutions operating in the financial marketplace.
For further information contact: Jillian Heffernan, Director of Communications, 087 9016880, jillian.heffernan@bpfi.ie.
