The regulator has promised to meet new voluntary targets in a letter to the chancellor today.

It will also have to meet new statutory targets, which will be consulted on and confirmed by the government.

Under proposed statutory targets, the city watchdog must process the authorisation of new firms or variation of permissions within four months where the application forms are complete (currently six months).

When application forms are incomplete, the regulation must carry out the process within 10 months (currently 12 months).

A further voluntary target has been set by the FCA for variations of permission which closely align to the existing business model, which should be processed in three months for complete applications and six months for incomplete applications.

For senior manager regime applications, at least half will be completed within 35 days with a proposed statutory deadline of two months (currently three months) for all applications.

The FCA says the targets also give firms some time to address feedback and remedy issues, to reduce the risk of authorisation being refused.

FCA executive director of authorisations Sheree Howard says: “We are taking forward the government’s new proposals and are prepared to go further and faster to facilitate growth.

“In doing so, however, we will maintain a robust authorisations process that helps safeguard the integrity of the UK’s competitive financial services market while protecting consumers.”

The regulator says 99% of applications are now completed within statutory deadlines.