In a consultation paper today, the regulator says that its annual funding requirement (AFR) has increased by around 4% from £755m in 2024/25 to £784m for 2025/26.

This proposed allocation to mortgage lenders and brokers, both of which fall into the A.18 group “home finance providers, advisers and arrangers”, is £23.5m for 2025/26.

This is up by 2.2% or by £0.5m from £23m for 2024/25.

For mortgage lenders that fall into the A.2 fee block, which also covers “home finance providers and administrators”, the FCA is proposing an increase of 1.8% from £23.6m to £24m.

The regulator has proposed the minimum Financial Ombudsman Service levy for mortgage advisers increase from £85 to £95 in 2025/26, which will raise an estimated £470,815.

The proposals suggest that lenders and brokers will also see increases to the levy they pay towards money guidance and debt advice, amounting to around £2m in extra costs.

In July, the FCA will publish its final fee schedule and the industry responses to this consultation.

The news comes as regulator also says it will help “bring innovative products and services to market faster” as it begins the first year of its new five-year plan.