The Financial Conduct Authority (FCA) is giving Zilch, ClearScore, Modulr, Teya and Urban Jungle dedicated regulatory support through its Scale-up Unit, including named contacts to help with new products, regulatory changes and compliance. The scheme aims to make the UK more attractive for growing financial firms, but does not mean reduced scrutiny. The FCA is also tightening rules in areas such as buy now, pay later and expects rapidly growing companies to strengthen management and risk controls. It is noted that six firms jointly regulated by the FCA and Bank of England – Allica Bank, ClearBank, Monument, Nottingham Building Society, OakNorth and Zopa – joined an earlier cohort in February. Jessica Rusu, the FCA’s chief data, information and innovation officer, said high-growth firms “play a vital role,” adding that the regulator wants Britain to remain one of the best places to start and scale a financial services company.

Capital Economics has warned that the Government could raise taxes by up to £25bn in October’s Budget to fund spending pledges worth as much as £40bn, including council housebuilding, higher defence spending and cost-of-living support. The tax burden is expected to shift away from businesses towards capital, wealth and income, with households bearing most of the increase. Potential measures include higher capital gains and inheritance taxes, pension changes and a new defence or social care levy. Analysts say that some spending pledges could be delayed to limit the impact on household incomes and Prime Minister Andy Burnham has ruled out increases to income tax, National Insurance and VAT. Ruth Gregory, deputy chief UK economist at Capital Economics, says that if taxes were to rise by £25bn, equal to about 0.8% of GDP, then the tax burden would rise to a new high of 39% of GDP.

While AI companies have long promised that automation will shorten working hours, BBC News says workers at the firms developing the technology are often working longer than ever. The report says some workers at OpenAI and Anthropic reportedly face “sprints” lasting weeks, sometimes exceeding 90 hours. At Meta, some employees have been moved onto urgent AI projects with long nights and weekend work. Research from UC Berkeley suggests AI may actually be increasing workloads, with employees working faster, taking on more tasks and extending their working days.

Retail sales in the UK increased by 1.3% year-on-year in July, according to the British Retail Consortium (BRC) and KPMG. However, this marks a slowdown from June’s 1.9% increase and is below the six-month average of 1.8%. The data shows that non-food purchases fell by 0.7%, while food purchases rose by 3.8%. Helen Dickinson, chief executive of the BRC, said that while food sales were boosted by the final week of the World Cup, non-food sales were hit by a decline in footfall driven by a heatwave.

Hedge Fund Research analysis shows that AI-focused hedge funds have seen their worst month since the 2008 financial crisis, falling 7% in July as US technology and Asian semiconductor stocks sold off. The decline reflects growing fears that the AI investment boom may be turning into a bubble, amid concerns over stretched valuations, huge spending and cheaper Chinese competition. Overall, hedge funds recorded average losses of 1.1%.

Britain’s banks are braced for higher taxes as the Government looks for ways to raise revenue. Szu Ping Chan in the Telegraph says that while major lenders have made £29bn in profits this year, making them an obvious political target, the sector already faces a higher tax burden than most industries. Banks currently pay 28% corporation tax, an additional bank surcharge and the bank levy. However, the Trades Union Congress has argued for a 16-percentage-point surcharge, potentially pushing the effective rate towards 60%. The industry warns further tax rises could make London less competitive and encourage banks and financial activity to move overseas. Ms Chan notes that higher taxes could also reduce banks’ ability to lend. While it has been suggested that ministers may ease regulation alongside any tax increase, particularly for smaller banks, City figures fear this would not compensate for a major raid on profits.

Chris Norbury, chief executive of E.On UK, has urged the Government to alleviate energy policy costs on business electricity bills. He believes that shifting these costs to general taxation could encourage investment in low-carbon technologies. E.On’s research shows that UK firms are deterred by high costs but could save over £2bn by 2035 by adopting clean energy solutions. Mr Norbury noted the positive direction of government policy, citing the removal of VAT on consumer electricity bills. He emphasised the need for stable energy policies to support businesses amid rising costs.

Parents are increasingly sceptical about the value of university degrees, with 41% believing they are less important for career success than two decades ago. A survey of 1,000 parents commissioned by Virgin StartUp shows that 63% are nurturing an entrepreneurial spirit in their children, viewing it as a more viable path. Additionally, 87% of parents want schools to teach more entrepreneurial skills, reflecting a shift towards valuing business acumen over traditional education.