In a new guidance document published this week, the FCA also highlighted the potential increased risk of financial crime for firms operating only on a remote basis.

The regulator said it will keep "under review" the impact remote and hybrid working have on how firms operate their business and their engagement with the FCA.

The watchdog said that it expects many firms to continue remote and hybrid working.

The FCA said firms should be able to prove that the lack of a centralised location or remote working does not prevent the regulator from receiving information about the firm, or affect the ability of the firm to oversee its functions or cause detriment to consumers.

The FCA noted that it was important that a move to hybrid or remote working on a permanent basis does not reduce the accuracy of the Financial Services Register.

The regulator added that if a firm intends to use a private residential address as a place of business, it should also consider the effect on any individuals and get necessary approvals, including from those living at the property who are not employees who may be affected by supervisory visits.

The FCA said: “We should be able to access firms’ sites, records and employees. It’s important that firms are prepared and take responsibility to ensure employees understand that the FCA has powers to visit any location where work is performed, business is carried out and employees are based (including residential addresses) for any regulatory purposes. This includes supervisory and enforcement visits.”

In its remote and hybrid working expectations document, the FCA said firms must also prove that there is satisfactory planning in place which has been reviewed before making any temporary arrangements permanent, and that this plan is reviewed frequently to identify new risks.

The regulator said: “It's important any form of remote or hybrid working adopted should not risk or compromise the firm's ability to follow all rules, regulatory standards and obligations, or lead to a failure to meet them.”

The regulator also reminded firms that it requires notification on how a regulated firm intends to operate, which can include remote and hybrid working arrangements.

The FCA’s remote and hybrid working expectations guidance can be accessed online here.